Eye on Productivity

Counting store traffic isn’t a new concept. What has been less common, however, is merging shopper traffic information with data like sales results to gain better insight into customers’ purchasing habits.

That was a goal of management at The Limited Stores, which operates about 220 stores in malls across the country from its base in Columbus, Ohio. The Limited was sold to Sun Capital two years ago, but continued to use the information systems of its former parent on a shared services basis.

The Limited has begun migrating to its own computer systems, says CIO Roger Coville, and management wanted to implement a traffic-counting system that would allow it to gauge how many shoppers were moving through its stores at different times, along with the ratio of shoppers who were being converted to buyers.

Armed with this information, management would be better able to align its staffing with fluctuations in shopper traffic, enhancing service without needlessly increasing labor costs.

In addition, management wanted comprehensive insight into store operations, says J.D. Story, chief technology officer with DIGIOP Technologies, an Indianapolis-based provider of video solutions. The Limited wanted to create a “dashboard of real-time business operations, bringing in multiple points of data so that they’d have a competitive advantage, operate more efficiently and provide a better customer experience.”

One option the retailer considered was a thermal imaging system, which captures the body heat generated by shoppers moving in and out of a store, allowing them to be counted. The images they produce often are grainy and difficult to decipher, and the accuracy of the systems Coville tested topped out at less than 80 percent.

Coville then investigated the bundled solution offered by DIGIOP, ObjectVideo and Dell. DIGIOP provides the video recorders, storage and video management systems used in many security, risk management and loss prevention applications.

Reston, Va.-based ObjectVideo provides video analytics and business intelligence applications; the company was founded by former employees of the Defense Advanced Research Projects Agency (DARPA) who have researched computer vision. Dell provides the computer hardware.

This combined solution produces high-quality digital images with accuracy rates of about 95 percent, Coville says. That’s important, given that the information it generates is used to make marketing and strategy decisions. In addition, The Limited compensates its store employees based partly on conversion rates, and therefore wants to ensure that they’re being counted correctly.

The solution allows The Limited to address its immediate need to count store traffic and to add other capabilities down the road. “They get an enterprise-scale solution, and can capture the low-hanging fruit [now] and gain positive momentum,” says ObjectVideo CEO Dave McGuinness.

The system can work with either new or existing analog or IP cameras (The Limited uses analog) and actually costs less than a thermal imaging system, even though The Limited decided to place four cameras in each store. While prices will vary by retailer, a base DIGIOP retail system runs about $4,000 per store; most retailers recoup their investments in roughly one year, Story says.

At The Limited, one of the cameras is positioned over the entry way and used to count shoppers moving in and out of the store. The other three are located over the cash-wrap area, each positioned to capture a different angle.

Installation proceeded smoothly, although it did require some tuning of the application. “You’re essentially drawing a box on the floor and trying to understand where customers are traveling through the box,” Coville says, “so some technical knowledge is required.” He is confident the extra up-front work will pay off in the form of more accurate and useful data.