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Smartphone apps track and reward shoppers

Before entering stores such as Best Buy, Target or Macy’s, Kelly Smith makes sure to turn on her smartphone’s GPS. She’s looking for “kickbucks,” the points she wins by entering stores associated with the cell phone application Shopkick. Scanning the barcode of items she’s interested in once in the store also earns her Shopkick points, which she can redeem for merchandise or discounts.

In return for gift cards, discounts and other rewards, brick -and-mortar stores associated with Shopkick draw traffic and get valuable information about customer’s shopping habits including what they’ve tried on and what racks they’ve perused.

Information-gathering technologies under consideration or in use include heat maps of stores showing where customers were and what they touched, as well as cell phone tracking programs that tell retailers what route customers are most likely to take through a store. Other technologies use cameras to tell where customers are looking to determine which displays are most effecting at grabbing attention.

Tracking programs, which sometimes use existing store surveillance cameras, can cause a backlash among customers who resent being tracked. Mary Caravella, associate professor at the UCONN School of Business, said there’s less resistance to tracking technology when customers choose it.

“If you have someone who’s opted into being tracked in exchange for a reward, it’s more readily accepted,” she said. “Approaches that allow the consumer choice in when and how to be tracked are going to be more readily acceptable and I think that’s true across all mediums.”

Macy’s is one of the retailers using Shopkick at its Westfield Mall store in Meriden. There’s no other customer cell phone tracking employed in Macy’s stores, according to spokeswoman Dianna Williams.

“We don’t engage with you until you engage with us,” she said.

Shopkick is activated in stores by inaudible sound waves sent through a store’s public address system. After trials, Shopkick became available for Macy’s stores nationwide last summer.

Target spokesman Eddie Baeb said the retail chain has its own app and recently launched a savings program app called Cartwheel.

Smith said she uses Shopkick most frequently at Best Buy and Target, both of which have Meriden locations. Purchases at those stores are linked to the app and automatically add to her points, although that’s not the only way accumulate rewards.

“I am still new at using it but really enjoy it. I love that I can get rewards for simply walking into a store and scanning items instead of having to purchase them to get the points,” Smith said.

She doesn’t have concerns about being tracked since she can turn off her phone to disable the GPS which signals where she is to the Shopkick app.

“The way I see it, they are only tracking my GPS and if I don’t have it on, they can’t do it, so I only turn it on when I am going to be in the area or know I am going to a specific store,” Smith said.

While there’s nothing stopping Shopkick users from scanning lots of products they have no interest in just for the rewards, Caravella said studies show that generally people play by the rules. For businesses, that means items scanned by a large number of people are probably pretty popular.

“You can reasonably trust the data,” Caravella said. “While there’ll be some gaming, in general people are helpful.”

Despite a “creepiness factor,” marketing attempts to figure out what customers like and dislike through technology aren’t going to diminish, according to Caravella.

“They will continue to grow. All of marketing has been affected by digital and how that’s made retail measurable and trackable,” she said. (203)317-2230 Twitter: @JBuchananRJ

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