10 min read

How facial recognition is bringing new value to today’s retail customers

Marcin Sadowski

Service Line Director, Digital Platforms

At various moments in recent history, the explosive growth of e-commerce seemed to spell doom for traditional brick-and-mortar retail. The growth is not slowing down: by 2020, the global e-commerce industry is projected to comfortably eclipse $4 trillion. But consumer habits have also proven that physical stores aren’t going to disappear either, at least not any time soon. In fact, retail stores have the opportunity to become even more customer-friendly and service-oriented than ever thanks to some key innovations, particularly those offered by facial recognition technology. Here are three ways retailers can use the technology to bring value to their customers.

Streamlining purchases and accounts through facial recognition  

The potential of facial recognition technology in retail is in its infancy of discovery. While some stores like Wal-Mart have piloted it as a means to track down shoplifters, the technology has even more capability to optimize the retail experience for customers.

In China, Alipay already uses facial credentials for authorizing electronic money transfers. Meanwhile, Chinese developer Face++ has developed facial recognition tools for local governments and transportation businesses for security purposes. Before long, the same tools will be integrated into the payment systems of restaurants and retailers. This means that when it’s time to pay, a simple face scan is all that’s needed.

But the facial recognition technology has the power for much more than making a single transaction easier. Businesses can use it to streamline the use of dossiers for individual shoppers that tracks purchases (meaning no further need for paper receipts), as well as loyalty points and rewards in the form of discounts and other special opportunities.

In other words, the era of having to carry around loyalty cards for every store (or having to remember the email address or phone number associated with these cards) may soon be over. Through a simple scan of the face, everything about someone’s experience with a retail store could be accessible.

Personalizing the customer journey through facial recognition

Of course, there is more to the consumer’s experience with a retailer than purchases and record keeping. And facial recognition technology could make the whole customer journey smoother, more effective, and ultimately, more valuable.

It may not be long before customers walk into a store, and the products they want to buy are already waiting for them. With a simple face scan, they could leave the store with their products in hand. With enough data, it’s even possible to imagine a scenario where stores know which products their customers will purchase before the customer even knows the product exists.

But there are other ways facial recognition technology can make life easier for retail customers. Microsoft Azure and others have developed cognitive services that go beyond simply identifying who someone is. Rather, they can tell us what that person is feeling at a given moment. This kind of information can inform a shop or a restaurant whether the level of service they are receiving is effective -- or whether the shopper would prefer to be left alone. It’s not hard to imagine how the right amount of this kind data could even inform businesses of how to more effectively intervene in certain situations with customers.

The business impact of having this level of information cannot be understated, as it could eventually inform better staffing efficiency, as well as training employees how to deal with their customers the right way.

Merging offline and online activities

We’ve already observed that retail stores are destined to survive the e-commerce boom. This being the case, the next challenge for retailers is to unify the in-store and online shopping experiences. If retailers are sophisticated about the way they collect and archive data on their customers, it’s possible for communication to be much simpler, more cohesive and continuous — whether the customer is interacting with the store online or in the store.

In fact, omnichannel marketing and communication gives retailers the opportunity to offer a much more holistic experience to their customers. This means every interaction becomes more targeted and purposeful, not to mention ultimately much more pleasant for the consumer. Facial recognition could play a role in this, as long as the data collected provides a tangible value for omnichannel communication purposes. At the moment, retailers are still experimenting with how this can be accomplished.

As facial recognition technology evolves to become even more sophisticated, we’re likely to see even more applications that provide significant value to retail businesses and how they interact with their customers. It’s clear that the in-store shopping experience has not just survived the e-commerce boom, but rather it has the power to evolve to become even better.

Challenge everything!

About pattern image