Jordan Fisher was troubled. Every variety of the Red Bull energy drink comes in a similar metallic can, and his company’s camera system, which tracks products that customers pick up in stores, was having trouble distinguishing them.
This obstacle was one of many that his company, Standard AI, faced while retrofitting a Circle K convenience store in Tempe, Ariz., with computer vision software, which tracks every item customers pick up so they can simply scan their app-enabled phone to pay as they leave, eliminating the checkout line. A network of more than 100 cameras can identify any of the thousands of similarly sized candy bars or beverages grabbed by customers, including cans of Red Bull, now identifiable thanks to a combination of geometric projections and higher-resolution cameras.
This tracking of consumer activity within the store — where shoppers look and linger, with cameras capturing their interactions and their near-misses — is part of a growing effort to use data collection to make commercial real estate more efficient.
“Checkout is kind of the killer app, but that’s just the tip of the iceberg,” said Mr. Fisher, the chief executive of Standard AI, which hones camera accuracy in high-volume, high-density environments. “You have a system that understands where people are in real time, down to the centimeter. It’s all about utilization of real estate.”
From the invasion of big-box stores to the ascendancy of e-commerce and, most recently, pandemic lockdowns, physical retail may seem stuck in perpetual crisis. But in-person shopping is still very popular and the subject of significant investment. (Retail tech investment hit a record $31.5 billion in the second quarter this year.) Amazon has spent generously on physical retail, including $13.4 billion on the acquisition of Whole Foods, and the development of its Just Walk Out system, which kick-started a race for cashierless checkout among grocery stores and retailers.
The added layers of technology in stores and entertainment venues — crowd-tracking cameras, information gleaned from smartphones, tallies of neighborhood foot traffic and sophisticated demographic data — aim to replicate the data measurement and analysis of the online experience.
But privacy advocates are sounding the alarm about the technology as Big Tech is under increased scrutiny. Congressional testimony from the Facebook whistle-blower, Frances Haugen, in October has intensified calls for new regulations to rein in Silicon Valley giants.
Complicating efforts to address privacy concerns is a lack of regulatory clarity. Without an overarching federal privacy law or even a shared definition of personal data, retailers must sort through layers of state and municipal rules, such as California’s Consumer Privacy Act, said Gary Kibel, a partner at the law firm Davis+Gilbert who specializes in retail privacy.
Technology companies counter the …….