Nottingham, 15 January 1999 - Noldus Information Technology and Tracksys Ltd, their UK distributor, have signed a contract with London-based BMP DDB Ltd to develop specialized software which will enable the real-time recording of consumers’ behavior in a retail environment. This is a new and exciting venture for all three companies as it will be the first commercially available system which can record consumer behavior on a large scale.

Beyond EPOS data - BMP DDB is a worldwide advertising agency with clients such as Volkswagen, Sony, Reuters, Kraft Jacobs Suchard, Johnson & Johnson Healthcare products and Vodafone. Siamack Salari, a behavioral researcher who heads the ‘Culture Lab’ at BMP DDB, has a team of people whose role it is to observe consumer behavior in naturalistic environments. Typically their clients are looking for ways of increasing their knowledge about their customers beyond that generated by EPOS (Electronic Point Of Sale) data, loyalty cards with demographic data and information from traditional market research methods, in order to gain commercial advantage over their competitors.

Hot spots - One area where a lack of information has been identified is what consumers actually do between entering and leaving a shop. At the moment the Culture Lab at BMP DDB records behavior from video. However, this is very time-consuming and consequently expensive for the client, given that samples of >100 consumers are often required. Secondly, the quality of the data generated could be improved, especially with respect to plotting consumers’ movement in a spatially-represented format for feedback to their clients. For example, a key request from Mr. Salari was to have the ability to identify and illustrate ‘hot-spots’ of consumer activity on a map of a store. Finally, real-time data collection is just not feasible at the moment.

The Observer - Siamack Salari approached Tracksys with a concept for resolving these issues and a system has been developed for testing with one of the premier retailers in the UK. Based on Noldus’ The Observer software for Windows 95/98, which already has the capability to record most of the behavioral parameters required by BMP DDB, a customized solution has been built which enables the user to input data, in real-time, via an interface which represents the spatial layout of the store.

Map interface - A map of the store is scanned into the PC and the researcher defines the aisles, checkouts and other zones of interest. This map is then displayed during data collection on a mini-notebook PC (248 x 164 x 39 mm) with a touch screen. When a consumer enters the store the researcher requests permission to observe him/her and initially records the age, sex and other independent variables of interest (there is even capacity to record loyalty-card numbers so that at a later stage in-store behavior can be compared with actual purchases made). The individual is followed through the store by the researcher, who clicks on the screen using a pen as they move through the predefined areas of interest. In addition to positional information, other behavioral variables can be recorded via user-defined items in dialogs, for example what products the consumer is looking at, picking up, placing in their basket or putting back on the shelf.

Data analysis - Data files collected during the day can be e-mailed to a central database where extensive analyses of the data can be carried out. This includes the frequency, latency and duration spent in different areas of the store, the frequency of transitions between the various zones of interest, and the number of times engaged in different behaviors, e.g. browsing, picking products up, talking to co-shoppers, asking for assistance, etc. This data can be calculated per individual or across different groups of customers according to age, sex or other independent variables.

How do consumers shop? - The intention is that once tested, the software should be simple enough for store employees to use, which will facilitate a huge rise in the amount of data collected about consumers. Initial feedback from BMP DDB’s clients indicates that they are very excited about this technology. The first retailer to test it will be WH Smiths in the UK, a leading stationery outlet. As Siamack Salari puts it: "For the first time retailers and producers will be able to know how we shop rather than simply what we buy."