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Tech could boost Malaysia’s retail industry

It is undeniable that retail is extremely profitable in Malaysia; it accounts for 10 per cent of the nation’s GDP, according to a recent report.

The sector is doing so well that the country will be able to boast of up to 700 shopping malls by the end of next year, which is roughly equivalent to a whopping 170 million square footage of the net lettable area.

Moreover, as the country’s economy increasingly more service-focused, and in line with Malaysia’s rapid digital transformation journey, local retailers and mall operators are adopting innovative future technologies to enhance customer experience and boost sales.

These technologies include facial recognition and shopper tracking system to obtain data that could be used to derive valuable insights.

In conversation with local media, the general manager of a Kuala Lumpur-based mall noted that the mall is currently trialling a new shopper tracking system that is capable of identifying shoppers’ unique mobile phones.

Noting that the project was in its initial phase, the GM stated that the tech enables developers to determine how many times a person comes to the mall and where they go while concurrently providing information on the number of shoppers at the mall. The tech is also able to provide an accurate account of the weekly and monthly foot traffic.

The data will be then be analysed to differentiate the shoppers to provide them customized notifications and promotions based on their shopping pattern, dwell time, travel history, and frequency.

The GM stated that the tech would allow analysts to automatically detect if it is a customer’s birthday and then notify them of special promotions in certain outlets. It was noted that this will be worked on in the second phase of developing the tech.

According to him, the technology was first rolled out by Sunway Pyramid in Kuala Lumpur’s suburb of Petaling Jaya.

The GM reportedly stands by the robustness of the system that also features functions that track children and avoids double ­counting. The tech also serves as a tool to measure the effectiveness of promotional campaigns.

It was noted that there are 55-56 sensors throughout the mall which cover different zones. They track where a person goes to, from one zone to another, and capture how many people are there at a particular time and how many people are there in an atrium – analysts are then able to generate reports using this information.

The set-up cost for the system ranges from RM115,800 to RM 148,900 with about RM10,340 being the monthly recurring cost. The tech is already widely adopted in malls in Malaysia’s neighbouring country, Singapore.

Meanwhile, Malaysian Retail Chain Association (MRCA) via its training arm MRCA Academy has been on a quest to promote digital transformation and adoption of future technologies such as facial recognition and data analytics among its members to increase efficiency and maintain a competitive edge.

The MRCA Academy deputy chancellor stated that technology will catalyse the retail industry to unprecedented growth, and enterprises should take advantage of the cutting edge solutions that are based on future technologies.

The Personal Data Protection Act makes it unlawful to record images of shoppers, but according to him, facial recognition technology could be utilized in other ways, to create a profile of individual shoppers based on their age group and gender.

The deputy chancellor noted that facial recognition can tell whether the person is a staff or supplier. If a customer walks past a store but doesn’t walk in, it can also tell the store owner how many people didn’t come into their store.

The tech is a way for store owners and operators to understand why customers don’t come in, and how to rectify this issue.

While cost will always be a significant stumbling block in any new digital initiative, traditional retail players must work on digital solutions consistently in order to keep customers coming back to the stores.

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