3/7/2014 The Economist explains: How do smartphones reveal shoppers’ movements? | The Economist

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Jul 21st 2013, 23:50 by G.F. | SEATTLE

The Economist explains

How do smartphones reveal shoppers’movements?

NORDSTROM, an American fashion retailer, is known for its high-touch customer service,

which has engendered customer loyalty ever since it was founded to supply prospectors for

the Yukon gold rush. It has a liberal returns policy, pays commission in a way that

discourages sales staff from being pushy and offers an enormous range of products. It also,

apparently, likes to keep tabs on its customers and potential customers without the need for

human intervention. For several months Nordstrom tested a system that tracked the

movements of people carrying Wi-Fi-enabled smartphones and other devices as they

wandered through 17 of its stores or merely walked by. The firm posted a public notice of

the monitoring, prompting a report by a television station in Dallas in May, at which point the

retailer pulled the plug. Then the New York Times picked up the story, igniting a privacy

debate about passive monitoring via Wi-Fi and other technologies. The system used by

Nordstrom and several other firms, provided by Euclid Analytics, can precisely track the

movements of individual phones, even though they never actually connect to a Wi-Fi

network. How does it work?

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The technique takes advantage of the fact that Wi-Fi wireless networking protocols are

"promiscuous": the Wi-Fi adaptors in laptops, phones and base-stations reveal a lot of

information about those devices as they attempt to negotiate connections with other devices

nearby. Even before a device hooks onto a Wi-Fi a network, it continuously spews

identifying information, including a unique, factory-set identifier, over the air. Most devices

send "probe requests" akin to a town crier shouting out the names of networks which the

device has previously connected to, so that a nearby base-station that matches any of these

requests can respond. The requests run unremittingly across all available frequencies until

a connection is made. Even devices that are seemingly turned off, such as sleeping laptops,

send out such probes, though at a slower rate. Place several Wi-Fi base-stations in a shop,

then, and you can pick up these probe requests, extract the device IDs, trilaterate the

positions of the devices sending them, and thus track the movements of individual

shoppers, seeing which racks or displays they stop at, and what paths they follow through

the store.

This is arguably just the latest development in the well-established field of "retail science", in

which the movement of shoppers is tracked and analysed. This was once done using video

cameras, with footage examined by operators to determine where best to place new

products or displays. Analysis of video is now heavily automated, and computers grind

through the data to work out when stores are busiest, when queues are longest and how the

positioning of products and promotional displays affects sales. The use of Wi-Fi tracking

allows merchants to anonymously track individual shoppers more accurately than is

possible with video, particularly in crowded stores. It also means returning customers can

be spotted without the need for facial recognition, by looking out for known device IDs.

All this is convenient for retailers, but worries privacy advocates. It is true that shoppers are

on private property, and signs announce the use of tracking technologies. But improvements

mean that Wi-Fi signals travel much farther than they did in the 1990s, so that people who

merely walk past a store or look in a window may be picked up by internal tracking systems.

More worryingly, because most Wi-Fi devices broadcast a list of known networks, a

monitoring system could, in theory, collect the list and match it against databases of known

Wi-Fi networks, which are used as a rough and ready alternative to satellite positioning in

built-up areas. Shoppers' stored list of connections could thus reveal where they live or

work, and possibly their identities. (Euclid says its system does not gather lists of network

names, only device IDs, which are then anonymised.) Google faced worldwide scrutiny from

regulators, and had to pay fines, after it emerged that its Streetview mapping vehicles had

collected massive amounts of data broadcast publicly by Wi-Fi networks, computers and

mobiles in many countries. Accordingly, Wi-Fi tracking firms now seem to be trying to get

ahead of regulators. The day after the New York Times story appeared, Euclid and other

firms announced a plan to partner with the Future of Privacy Forum to set rules about Wi-Fi

tracking. In the meantime, if you are worried, there are two absolutely effective ways to

prevent such tracking: turn off Wi-Fi and Bluetooth on your phone and laptop when out and

about, or turn the devices off altogether.

Correction: This post originally stated that Nordstrom does not pay its staff commission,

which was incorrect. The text has also been amended to make it clear that Euclid's tracking

system does not gather the network names broadcast in probe requests. These changes

were made on July 23rd.

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Solution? Turn off wifi ;)

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3/7/2014 The Economist explains: How do smartphones reveal shoppers’ movements? | The Economist

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VahciYQ3od Jul 22nd 2013, 20:39

MySetDancer in reply to VahciYQ3od Jul 23rd 2013, 01:31

G.F. - The Economist in reply to VahciYQ3od Jul 23rd 2013, 04:09

Canadian Engineer 1917 Jul 22nd 2013, 18:27

dalax Jul 22nd 2013, 16:39

1) "If you want to be sure your'e not tracked, pull out the battery!" (Johan Sterk)

2) "The only way you can turn your phone off completely from being a personal tracker is to remove

both the battery and the SIM." (TonyF2)

3) "But they might have a chip or something. If you want to be 100% sure, do not own a smartphone

—or own it, but don't take it with you when you go to Nordstrom." (Anonymous)

Nordstroms are collecting anonymous data - why is this not clearly mentioned in the article? It's no

difference to having a member of staff standing around with a hand-held clicker counting people as

they go past.

Theoretically if you were to sign up to a store's loyalty program using your smartphone, and there

was a lot of work done to integrate with the stores CRM system, then you can be individually tracked

as you walk around the store - but no one is doing this, yet.

There are no privacy issues in this implementation, it's just a technically advanced hand-held clicker

for all intents and purposes.

Note that while the article is generally accurate to begin the latter part is technically incorrect, and

should not be taken at face-value.

Nordstrom can pay to have the WiFi network names your device is probing-for matched against

what Google has collected by driving by your home and business. Then, your address is

matched against a database of addresses to resident, so Nordstrom knows exactly where you

live, and perhaps work, shop, eat, worship, and probably your name or family name at least.

Remember, your device is constantly broadcasting the name of the networks you have

connected, to, so since they can all be matched-up, there is nothing anonymous about it.

Firms make all sorts of assertions about the use of data they collect, and some of those

assertions would be actionable if proven otherwise. There is no supposition that Nordstrom or its

provider is misusing data. Rather, the issue is explaining the richness of data collected and what

could be done with it.

Expand 1 more reply

It’s just one shock after another. We ought to request from our governments a free public

anonymizing internet/cell phone network of sorts. The kind that is inherently anonymous without

having to trust the network provider. The increase in taxes would be offset by eliminating our own

internet/mobile bills.

My wife is a Nordstrom salesperson and I promise you that she works on commission - which is

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3/7/2014 The Economist explains: How do smartphones reveal shoppers’ movements? | The Economist

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T.S. - The Economist in reply to dalax Jul 23rd 2013, 10:31

TonyF2 Jul 22nd 2013, 15:55

Accrux Jul 22nd 2013, 10:13

Accrux in reply to Accrux Jul 22nd 2013, 20:52

Johan Sterk Jul 22nd 2013, 08:03

surfson in reply to Johan Sterk Jul 22nd 2013, 09:40

often negatively impacted by the companies' "liberal return policy."

That beef aside, as an InfoSec professional I'm not sure what the concern is here. Perhaps Nordies

will use this information to lay out its' stores more conveniently for shoppers and we will spend more

money there?

Yes, we were wrong to say that Nordstrom sales staff are not paid commission. We've fixed it.

Thanks.

The only way you can turn your phone off completely from being a personal tracker is to remove both

the battery and the SIM.

They 'trilaterate' customers and try to see where they are, and then follow them.

What would come next, consider them as NORAD would consider UFOs, trying to find out whether

they are from the Earth or from Rigel? And what would happen if they [the customers] actually are

from Rigel?

Anyway, it smacks of Big Brother.

"And what would happen if they [the customers] actually are from Rigel?"

------

Allow me to answer my own question: well, as long as the EBEs pay cash or have a valid credit

card...

If you want to be sure your'e not tracked, pull out the battery!

Thank you !!! Apparently some harassing entity knows when I go by my old welding shop. They

show up to block my way into my driveway with uncanny precision. When I call the cops at 10

pm they're too busy to come lend a hand!!!

They're mad because I sued a Dr. friend of theirs who butchered a young woman. The Mayor was

an Insurance Salesman.

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edwardong Jul 22nd 2013, 02:11

MoJos in reply to edw ardong Jul 22nd 2013, 09:52

Or, Nordstrom et. al. could offer shoppers discounts in return for turning on their Wi-Fi. Win-win! :-D

Same as they do with loyalty cards? Which are the absolute pits when it comes to privacy.

I for one would like to see a list of all shops that employ such underhanded tactics in order to

make sure to never leave a frigging cent at those premises.

I don't mean loyalty cards, where I can (and do) chose not to have one. But sleazy, sneaky

outfits that snoop on me, abusing a device owned by me and most certainly not being authorized

by me to do so and even then when I'm not on their premises.

A tiny notice in grey, 3 point font on a dark grey background those make me neither informed nor

consenting.

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