E-commerce provides some distinct advantages over tradition “bricks and mortar” retail outlets. When you’re selling products on a website, you can easily track meaningful information such as how long your customers look at every product, which products they put into their carts or take out, which advertisements draw their attention, and the paths they take through your store before they purchase; or don’t purchase for that matter. So why can’t traditional retailers be enabled with a similar technology? One retail analytics startup called Nomi is looking to turbocharge bricks-and-mortar retailing with the same rich analytics as online merchants get to enjoy.
Nomi started out as a company called Brickstream, and was founded in 2000 by ex-Salesforce employees. Atlanta-based Brickstream took in $57 million in funding to develop their sensor platform that tracks customer behavior in traditional bricks-and-mortar retail stores. In October of 2014, Brickstream acquired Nomi and the merged company changed their name to Nomi and retained the Brickstream name for their hardware products. With more than 140,000 Brickstream sensors being used in stores located in more than 60 countries, Nomi now claims to be the market leader in retail store analytics with the industry’s only patent-protected vertically integrated solution. Customer adoption seems to be happening quickly, and in the quarter during which the two companies merged, they managed to bring in 32 new clients.
The retail analytics offering by Nomi has a truly remarkable value proposition for retailers. Each arriving person in the store is assigned a tracking identifier using Brickstream advanced video hardware as seen below:
The Brickstream cloud-based software analytics system then links the person’s movements across Brickstream sensors, following the person wherever they go. The Brickstream 3D sensors on the Nomi platform can see past overlapping objects to provide a truly accurate measurement of what people are actually doing in your store. Nomi guarantees 95% accuracy and typically delivers between 98% to 99% accuracy. The system can also distinguish adults from children and shopping carts while tracking customers on an individual basis or by groups.
The potential of this technology lies in the vast amount of data it can capture and analyze. You can track customer loyalty, new or returning customers, the success of events or campaigns, loss prevention, cross store visits, and the list goes on. Introducing game elements into the shopping experience could make dull weekend shopping a much more exciting experience. In January of this year, Nomi introduced “Nomi Mobile”, an in-store engagement platform which allows you to send real-time discounts or promotions to consumer based on their behavior in your store. The platform was introduced by Numi CMO Marc Ferrentino who was quoted as saying:
Ever since we launched the largest public beacon-based campaign back in April for the Faberge Big Egg Hunt, we knew that gamification would be one of the most successful ways for retailers to entertain and reward their most loyal customers.
With so much information being tracked, Nomi stresses that customers remain anonymous in order to alleviate any privacy objections. But is there any reason the system couldn’t also tie into the cash register and connect your visit with your purchase as well? At a minimum, the system could track what ended up in your cart at the end of your shopping trip. That information can provide some powerful insights into your shopping behavior, especially for recurring customers.
Risk averse retail investors love Walmart (NYSE:WMT), a $190 billion company with a beta of just .27 which has paid a dividend and increased it every year for 42 years in a row. These days, Walmart (NYSE:WMT) is looking at making large investments in technology in order to keep increasing those dividends as their revenue growth continues to slow. Nomi would be an attractive acquisition for Walmart (NYSE:WMT) to make, otherwise you can be sure Walmart (NYSE:WMT) is already developing a similar technology on their own.