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1A/R/T Forum June 12, 2006 Copyright © 2006 Indiana University
Customer Tracking
Professor Ray BurkeE.W. Kelley Professor of Business Administration
Director, Customer Interface Lab
Indiana University
Alex LeykinPhD Student
Department of Computer Science
Indiana University
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The Evolution of Marketing Intelligence
• Wave IBrand and Category Management
• Wave IICustomer Relationship Management
• Wave IIICustomer Experience Management
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Wave I – Brand and Category Management
• Enabling Technologies
UPC barcode scanning
• Causal Variables
Price, promotions, displays, feature ads,
product assortments, shelf space
• Performance Measures
Sales, market share, gross margin,
sales/square-foot, turn rate, GMROII
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Wave II – Customer Relationship Management
• Enabling TechnologiesCustomer loyalty cards, credit/debit cards
• Causal VariablesWave I, plus:
Customer attributes (geodemographics),
purchase history, targeted promotions
• Performance MeasuresCustomer retention, customer loyalty, share-of-customer, lifetime customer value, ROC curves
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Wave III – Customer Experience Management
• Enabling TechnologiesReal-time customer tracking
(RFID, GPS, video, clickstream)
• Causal VariablesWave II, plus:
Store layout, displays, navigation aids, music,
product adjacencies, service levels, queues/crowding
• Performance MeasuresStore traffic, shopping path, aisle penetration,
dwell time, product interaction, conversion rate
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Key Customer Touchpoints
• Store Entrance and Window Displays
• Lead Fixtures and Merchandising
• End-of-Aisle Displays
• High Volume / Margin Departments
• Customer Service Desk
• Checkout
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Observational Measures
Engagement:Examination of signs, displays, circulars
Category dwell time
Salesperson contact
Product/package/display interaction
Conversion:Aisle penetration
Purchase conversion rate
Product price/margin (absence of incentive)
Shopping basket size
Returns
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Benefits of Computer Tracking
Breadth of Coverage:Census of customers/items (e.g., for security, inventory)
24/7 tracking (time of day/crowding analysis)
Potential to track entire store (path analysis)
Scalable to multiple stores (benchmarking, experiments)
Speed:Real time data (e.g., for staffing, replenishment)
Data Integration:Link path, penetration, conversion data to consumer
demographics, shopping basket, purchase history
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Computer Tracking Solutions:Tracking Carts with Infrared/RFID Sensors
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Computer Tracking Solutions:Tracking Carts with Infrared/RFID Sensors
• LimitationsOnly applicable in retail stores using carts and/or baskets (e.g., grocery, mass retail)
Only tracks customers who choose to use carts/baskets, losing “fill-in” shoppers
Unable to track customers who leave carts. May overestimate perimeter traffic, dwell times
No measure of gaze direction or package interaction
No information on group size or behavior
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Computer Tracking Solutions:Tracking Shoppers with Video Cameras
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Computer Tracking Solutions: Tracking Shoppers with Video Cameras
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Automatic Behavior Analysis
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Incoming Store TrafficInitial Direction Distribution
Aisle26%
Aisle37%
Aisle113%
Checkout Area30%
MainAisle44%
Average Store Traffic by Hour of Day
0
20
40
60
80
100
120
140
12am
-1am
1am
-2am
2am
-3am
3am
-4am
4am
-5am
5am
-6am
6am
-7am
7am
-8am
8am
-9am
9am
-10a
m
10am
-11a
m
11am
-12p
m
12pm
-1pm
1pm
-2pm
2pm
-3pm
3pm
-4pm
4pm
-5pm
5pm
-6pm
6pm
-7pm
7pm
-8pm
8pm
-9pm
9pm
-10p
m
10pm
-11p
m
Total Store Traffic
500
550
600
650
700
750
800
850
900
950
3/4/
2005
3/6/
2005
3/8/
2005
3/10
/200
5
3/12
/200
5
3/14
/200
5
3/16
/200
5
3/18
/200
5
3/20
/200
5
3/22
/200
5
3/24
/200
5
3/26
/200
5
3/28
/200
5
3/30
/200
5
4/1/
2005
Collection Period 3/3/05 - 4/2/05
Store Entry and Traffic Patterns
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Post Period
Pre Period
Aisle Penetration
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Category Dwell Time
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Computer Tracking Solutions: Tracking Shoppers with Video Cameras
• Limitations
Cameras have a limited field of view and work best in smaller stores (e.g., specialty retail stores, drug stores, convenience stores, banks)
Tracking entire customer path requires multiple cameras with overlapping views
Occlusions (e.g., shelving, signage, other customers) and shadows can interfere with tracking
Difficult to distinguish between employees and customers
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Tracking - System Overview
Detection Tracking Activity Recognition
The tracking system works in three steps:
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Tracking – Background Subtraction
• Each background pixel is represented as a stack of values
• To decide if a new pixel is a part of the background, a lookup is performed through the full stack and if no matches are found the pixel is considered to be a “foreground pixel”
codebook
codeword
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Tracking - Blobs
• The result of background subtraction is a binary bitmap
• Foreground regions corresponding to moving people are represented as blobs (in red)
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Tracking – Camera Model
• Parallel lines and the heights of objects in the scene are used to determine the camera’s location and field-of-view
• The camera model permits the translation from world coordinates to image coordinates and back
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Tracking – Detecting Heads
The head is usually the least occluded part of the human body. Therefore, to reliably detect multiple people within one blob, we look at their head locations:
1. Estimate the height of each vertical line of the blob
2. Find a number of local maxima in the resulting histogram
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Tracking – Detecting Heads (cont.)
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Tracking – Probabilistic Modeling
At each instant in time, the tracking system attempts to find the model of the scene which:
Best fits the current observation (what’s in the image)
Is consistent with the model from the last observation
The system estimates the following parameters for each person:
• body width and height (cm)
• current location on the ground (X and Y)
• color histogram
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Tracking – Sampling Dynamics
To construct a new model, we randomly apply a number of “jump-diffuse” mutations to the old model
Then the likelihood of the new model is evaluated
• Add body
• Delete body
• Move
• Change height
• Change width
• Change position
• Switch ID
Jump Steps Diffuse Steps
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Tracking - Results
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Tracking Example: Camera View
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Tracking Example: Store View
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Insights from Observational Research
• Store Entry
Shoppers take time and space to adjust to the in-store environment
Identify “recognition points” where consumers slow down and start observing
Provide answers and solutions, including signs, circulars, baskets, cash/wrap
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Insights (cont.)
• Traffic Flow
Identify dominant pathways through the store
Angle and direction of approach determines best position/orientation for signs and displays.
The greater the speed of approach, the shorterthe message
Facilitate incoming access to destination products, outgoing access to impulse items
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Insights (cont.)
• Penetration and Purchase Conversion
Low penetration categories may require additional navigational aids, new product displays, merchandising, and/or changes in store layout to improve traffic flow
Categories with low purchase conversion rates may indicate weaknesses in product assortment, pricing, or presentation
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The Original Men’s Section
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Men’s Style Center - Outfits
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Men’s Style Center – Product Table
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Making It Easier for Men to Shop
Enhanced product display drives category traffic and sales:
85% increase in product fixture interaction
44% increase in unit sales
38% increase in dollar sales
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Insights (cont.)
• Crowding
Provide sufficient aisle width for displays, carts, strollers, crowds
Reposition fixtures or product displays to eliminate bottlenecks
Avoid crowding in categories requiring extended decision times
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Insights (cont.)
• Checkout
Measure queue lengths and waiting time to flag problems with line management, checkout process and customer service
Reduce waiting time by opening more lines, eliminating price checks, speeding up credit authorization, and employing self checkout
"Black Friday" Boosts Store Traffic...
0
200
400
600
800
1000
1200
1400
1600
6-7AM 7-8AM 8-9AM 9-10AM 10-11AM
11-12PM
12-1PM 1-2PM 2-3PM 3-4PM 4-5PM 5-6PM 6-7PM 7-8PM 8-9PM 9-10PM
11/28/2003
11/21/2003
Source: Burke 2005
… But Not Purchase Conversion Rate
0%
10%
20%
30%
40%
50%
60%
6-7AM 7-8AM 8-9AM 9-10AM 10-11AM
11-12PM
12-1PM 1-2PM 2-3PM 3-4PM 4-5PM 5-6PM 6-7PM 7-8PM 8-9PM 9-10PM
11/28/2003
11/21/2003
Source: Burke 2005
“Black Friday”
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Challenges
• Creating the Digital Store
• Employee Identification
• Tracking Customer Groups
• Measuring Focus of Attention
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Challenges: Creating the Digital Store
• We need an accurate record of:
Store layoutProduct placementVisual environmentStore events
• A digital representation of the store is created from store floor plans and planograms, and extracted from video
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Challenges: Employee Identification
• If employees wear uniforms, the system can single them out by using a “color fingerprint”
• In other retail contexts, employees can be identified behaviorally (e.g., tracks that walk behind registers or into stockroom)
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Challenges: Who is shopping together?
• After recording each customer’s path on the floor map, we compute time-space cross-correlations between pairs of paths
• This correlation is used as a metric in a clustering process to detect shopper groups
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Challenges: Tracking Customer Groups
• Goal: In 1 hour video segment detect shopper groups
• We treat customers as swarming agents, acting according to simple rules (e.g. stay together with swarm members)
5
1 6
10
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Challenges: Swarming
• The actors that best fit this model signal a Swarming Event
• Multiple swarming events are further clustered with fuzzy weights to find out shoppers in the same group
11
1213
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Challenges: Measuring Focus of Attention
By exploiting a number of visual cues, such as walking speed, shoulder position and facial color, we approximate the angle of the customer’s gaze
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Summary of Tracking Insights
1. Track customer path
2. Measure category penetration, dwell time, and conversion
3. Measure line queues and crowding
4. Cluster shoppers based on path similarity
• Evaluate store layout and product adjacencies
• Manage in-store communication, product assortment, and pricing
• Manage service levels, staffing
• Behavioral segmentation
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Resources
Questions?
rayburke@indiana.edu
Indiana University’s Center for Retailing:
The Third Wave of Marketing Intelligence
Available online at www.kelley.iu.edu/retail
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