Emerging, cutting-edge technologies don’t come with user manuals.
Unlike currently-in-use technologies that are widely understood, new technologies like indoor positioning systems (IPS) raise a few new questions: What can I use this for? Why do I need this? How would it work in my situation? Why is this better than our existing technology?
We reached out to a number of shopping mall clients with the goal of understanding their thoughts on IPS, what value and promise they see in the technology, and what matters to them.
This article explores the three most important insights we learned:
Customer Satisfaction Is Number One
One question that typically gets thrown around has to do with the investment in IPS: What is the ROI? When we queried our shopping mall clients on this topic, their responses were rather surprising: “I don’t look at it from a pure ROI standpoint or earning money on it; I think it is a capability that we want to deploy for the benefit of the customer and the user experience,” said one of the mall managers who participated in the survey.
While ROI is important, quantifying the value of one part in a complex system, such as IPS in a mall — especially before it has been launched — is tricky. Focusing on its value in increased customer satisfaction and how that translates into revenue is an alternative viewpoint that is popular among mall operators.
Most respondents of our informal survey said ROI isn’t their top concern; they view IPS as a means to relieve pain points for their visitors, thereby creating a better shopping and visiting experience for mall patrons. “We’re doing it almost exclusively to solve that pain point for customers right now, of providing greater context and peace of mind — that’s the driver for us,” says a representative for a large mall chain in the U.S.
One can compare IPS to free WiFi, lovely indoor gardens or sparkling clean facilities. While it’s difficult to determine how much a nice and tidy mall contributes to the bottom line, most shoppers would say the cleanliness of the space invokes a better shopping experience. And that, in turn, will make customers want to stay longer, and potentially spend more money.
“It is difficult for us to measure direct sales contribution from any change in the mall. But at the end of the day, we want to influence, in some form or fashion, higher sales per square foot,” adds a respondent who works in mall management.
Like many investments, IPS ROI is easier to measure with time and perspective. “You have to look at it in the long term, and there it’s a good investment,” one mall representative concludes. Naturally, shopping malls want to monetize, but customer service is still their top priority.
The ‘Basic’ Use Cases Are The Most Sought After
When probed for what pains IPS solves for shopping malls, respondents said that while IPS can be used to enable a multitude of sophisticated services, they believe the fundamental aspect of IPS — navigation — is the most impactful. One of the most prominent challenges mallgoers face is simply finding what they are looking for — a certain store, the closest ATM or their vehicle.
“The ease with which you can navigate and understand where you are leads to a greater peace of mind for the consumer,” says a respondent who works in mall management at a large shopping mall chain.
Given the enormous size of some shopping malls, shoppers find value and convenience in simply understanding where they are, what's around them or where to find a certain store. Although physical signage, store directories and mall maps are not going away anytime soon, using the digital guidance provided by IPS in their own smartphones can save visitors a lot of time and effort.
While there are many exciting and interesting uses of indoor location services, such as geofencing, analytics and social applications, it is clear that the fundamentals of navigation — Where am I? Where is everything else? How do I get there? — enable the most compelling use case for IPS in shopping malls today.
Positioning Accuracy Is Not The Deciding Factor
There is a lot of (possibly misplaced) focus on accuracy and precision in the IPS industry. Analyst firms frequently test and measure the accuracy of different systems. That made us curious as to what extent this metric resonates with the companies who purchase IPS systems. While high accuracy is necessary, there are several other aspects that are equally or more important, according to the respondents of our poll.
When the goal of such a service is adoption among users, a set of features such as cross-platform compatibility and user experience far outweighs accuracy. “Obviously we want something that is accurate, but you also need something that will work across multiple devices,” says one respondent, adding, “The ability to identify which floor the user is on is also important. It must be fast and not jump around. It can’t take 30 seconds to find a user. What user is going to wait 30 seconds? And it’s got to work if the Internet isn’t perfect, because it is not perfect in a big venue.”
These requirements, combined with operational requirements such as installation time, ease of use and maintenance effort are all very important. Accuracy, sometimes heralded as a definitive measure, appears to be a piece of a bigger puzzle.
In the end, the real value of IPS for shopping malls is creating a positive user experience. Did the harried shopper find his car easily? Was the shopper able to quickly locate the store she was looking for? Was the mom able to locate a nearby restroom for her young child? While IPS offers lots of benefits and potential for mall owners and stores within the mall, the biggest early impacts sit squarely with mall patrons. And that’s the way it should be.
Jonas Callmer is a Co-founder and Vice President of Product at Senion, the leading indoor positioning solutions provider for shopping malls. Callmer is responsible for Senion’s product portfolio and strategies and also involved in sales and project management with major customers. He received his PhD at Linköping University in 2013 studying how sensor fusion applied to indoor positioning scenarios.