Although there are 300 Altromercato retail stores, each of the Italian retailer’s locations varies in terms of what products it carries, the store layout and even the size of the shop. Between the 300 locations there are 100 owners, and the stores range in size from 50 to 300 square meters, says Andrea Monti, general manager at Altromercato.

Because the stores are so different, Altromercato wants a better grasp on who shops at each of their locations, since the typical customer may vary, Monti says. Once a shop owner knows who the typical shopper is the merchant can make better decisions on which products to display in the front of the store, for example, with the idea that will boost sales, he says.

The retailer is piloting putting a small sensor into its stores that combines a beacon, a camera and a Wi-Fi hotspot. The sensor is produced by technology vendor Taggalo. A beacon is a small piece of hardware that lets a retailer track shoppers’ mobile devices and send marketing messages based on their location.

Altromercato, which specializes in so-called “fair trade” products from artisans and farmers in less-developed economies, recently put the devices in two stores, one in Milan and one in Genoa. The organization, a consortium of cooperatives and nonprofit organizations, plans on deploying the sensors to a total of 10 of its stores for a six-month pilot. Altromercato plans to have between five and 10 sensors in each store. The devices will go in the store’s front window or windows, at the front entrance and in a few aisles with different types of products.

The camera on the device has facial recognition software that can identify the age and gender of the person who has walked by it, and it can record 18 faces at a time, says Paolo Guida, co-founder and investor at Taggalo. The camera is about 90% accurate with its determination, Guida adds.

Altromercato wants to sell more fashion apparel products, particularly to young women. With this technology, the retailer will know which of its stores have a large number of young female shoppers coming through the door, so the retailer can be sure to display the fashion apparel up front in those locations.

Altromercato hopes that it can apply the results it learns in the stores participating in the trial to similar stores. For example, smaller stores in urban locations with high traffic from males aged 30 to 40 sell more food products, so a store that learns that it is catering mainly to this demographic may want to more prominently display food items in the front store windows.

The camera does not store any of the photos it takes. As soon as it analyzes the face, it only stores the data, such as “22-year-old female.”

“We wanted to have something that would work in any country or any geographic location regardless of privacy law,” Guida says.

Altromercato has a sign up in its stores alerting customers that it is collecting market data, Monti says. Because it just set up the sensors, Altromercato does not have any results to share.

Since the device can track how many consumers are walking by the store, via a camera in the front window, and how many consumers enter the store, via a camera at the front, Altromercato can gauge the effectiveness of the front displays and how many consumers that could have entered the store actually did.

If consumers connect to the Wi-Fi with their smartphone, Altromercato will know how long that consumer is in the store and if that shopper has been to the store before. These types of analytics will give Altromercato a better sense of who their customer is at each location, such as a majority of Altromercato shoppers visit the store four times a month and stay in the store longer than first-time shoppers.

Altromercato does not yet have a plan to use the beacon technology in the sensors.

For three sensors in one store, the technology costs about $1,000, and a monthly fee to use the software is $40 per sensor, Guida says. Monti says the technology is cheap for the marketing analytics the retailer receives. Altromercato plans to spend around $4,000 for the first two stores on the pilot. Altromercato’s headquarters is fronting the cost for the pilot and plans to help shops with the costs if it rolls it out to all of them, Monti says.

 

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