How Data Reshapes Real Estate-The New York Times

2021-11-25 09:07:10 By : Mr. Liu Tommy

Technology start-ups are providing new tools to help retailers and entertainment venues increase efficiency by counting people, tracking foot traffic, and following local shopping habits.

Jordan Fisher was troubled. Each Red Bull energy drink is packed in a similar metal can, and his company's camera system tracks the products customers buy in the store, but can't distinguish them.

This obstacle is one of the many obstacles his company Standard AI faced when using computer vision software to transform a Circle K convenience store in Tempe, Arizona, which can track every item picked up by customers so that they only need to scan Mobile phones that support apps can pay when they leave, eliminating the checkout line. A network of more than 100 cameras can identify any of the thousands of similarly sized candies or drinks captured by customers, including Red Bull cans, which can now be identified by a combination of geometric projection and higher-resolution cameras.

This tracking of consumer activity in stores—the gaze and stay of shoppers, capturing their interactions and their unsuccessful incidents with cameras—is part of an increasing effort to use data collection to improve the efficiency of commercial real estate.

"Checkout is a killer application, but it's just the tip of the iceberg," said Mr. Fisher, CEO of Standard AI, which improves the accuracy of cameras in high-capacity, high-density environments. "You have a system that can understand where people are in real time, accurate to the centimeter. It's all about the use of real estate."

From the intrusion of hypermarkets to the rise of e-commerce, and the recent pandemic blockade, physical retail seems to be in a permanent crisis. But face-to-face shopping is still very popular and the subject of a lot of investment. (In the second quarter of this year, retail technology investment reached a record 31.5 billion U.S. dollars.) Amazon's physical retail spending reached 13.4 billion U.S. dollars, including $13.4 billion for the acquisition of Whole Foods and the development of its Just Walk Out system. Initiated a competition between grocery stores and retailers for unmanned checkout counters.

The added technical layers in stores and entertainment venues—crowd tracking cameras, information collected from smartphones, neighborhood traffic statistics, and complex demographic data—are designed to replicate the data measurement and analysis of the online experience.

But as large technology companies are increasingly scrutinized, privacy advocates are issuing warnings about the technology. When Facebook whistleblower Frances Haugen testified before Congress in October, there were growing calls for new regulations to control Silicon Valley giants.

The lack of regulatory clarity complicates efforts to resolve privacy issues. Gary Kibel, a partner at the Davis Gilbert law firm specializing in retail business, said that if there is no overall federal privacy law, or even a common definition of personal data, retailers must classify state and municipal regulations, such as consumption in California. Privacy law. privacy.

Technology companies have responded to this resistance by pointing out that their systems are designed to limit the content they collect and anonymize the rest. For example, Standard AI's system does not capture faces, so it cannot be analyzed using face recognition technology.

More and more consumer and crowd behavior data have had a significant impact on real estate design. It even makes the physical space of marketers more interactive.

WaitTime is an artificial intelligence crowd-counting startup supported by Cisco Systems, used by venues such as Dodger Stadium and Melbourne Cricket Ground in Australia. In the FTX arena where the Miami Heat played, the digital information at the entrance of the lobby supported by WaitTime not only tells fans where to find food and drinks, but also tells fans the length of the team.

In today's market, "data eliminates risk," said Ken Martin, Cisco's executive director of global sales, adding that crowd tracking technology can guarantee a high return on investment.

The increasing use of crowd counting technology is part of a wave of change that industry experts say that sports and other entertainment venues will be used to improve safety and crowd flow and allow mobile and contactless ordering.

Sanford D. Siegel, CEO of NewMark Merrill, which has more than 80 shopping malls, and chairman of BrightStreet Ventures, a company that develops the retail industry. “This technology is aspirin. Take penicillin when you are comfortable, it can save your life? Today, it is definitely penicillin."

Many industry observers believe that these methods can improve performance, but others are skeptical.

Mark A Cohen, director of retail research at Columbia Business School, said: "I am a fan of fact-based decisions, but there are many crooks who promise unreasonable things in terms of results."

But proponents believe that data can change decisions by simplifying leasing and reconnaissance of new locations. Detailed information about how customers use parking lots or specific stores can help landlords and owners better manage their malls and shopping centers.

"It's not that the data is so disconnected from intuition. The data is real and provides the additional impetus that brands need to open a store," said Adam Henick, founder of Current Real Estate Advisors, who specializes in social media and data analysis.

He compared the use of real estate data with the recent adoption of a more aggressive defensive formation by Major League Baseball, using statistical analysis to move the outfielder for each batter. This is the same game, but the strategy and certainty of playing is much higher.

Ethan Chernofsky, vice president of marketing at, which provides location intelligence and demographic data to retailers, said brokers can more easily filter potential locations to a few locations based on a combination of local demographic data and nearby stores.

"Now, you really understand the demographic data, actual foot traffic, the value of co-tenants and their foot traffic in a certain location, and you have a richer understanding of the location," Kevin, the head of the joint venture's retail technology fund Said Kevin Campos. The fifth wall of the capital company. "This is a smarter dialogue between landlords and potential tenants."

Placer has approximately 800 clients in the commercial real estate and retail sectors, including top brokerage firms and developers such as Tishman Speyer and Marcus & Millichap. James Cook, director of retail research for the Americas at commercial real estate company Jones Lang LaSalle, said that Placer data has always been the tool of choice for measuring repeat customers this year. It provides insights from a week ago, while early methods will lag three or four months. Broker.

The development of data mining has attracted more entrepreneurs who are eager to create more digital experiences for retail brands.

Leap is a New York start-up company that operates boutiques in several states, operates small, usually digitally native, direct-to-consumer brands, handles their real estate, design work and even data analysis, co-CEO Mistoria said Leap. For example, online retailer Goodlife Clothing hired Leap to operate two of its stores in Manhattan.

Goodlife co-founder and co-CEO Andrew Codispoti (Andrew Codispoti) said: “I look at this business digitally, and they look at it the same way.” “Based on your data as a brand, they Is becoming an expert in more and more places across the country, where to develop."

The choice of opening a turnkey location is a big selling point, but Leap also incorporates a shopping model that includes local e-commerce sales, foot traffic and community demographics across all of its locations. This allows it to pick ideal tenants and even tell them the most profitable products to display.

"Leap will effectively have a nationwide data set that is truly meaningful to retailers and real estate owners," said Mr. Henick of Current Advisors, a company that helped Leap find a Manhattan location for retailers. "It allows brands to be satisfied with their success rate in a particular location."

He added that data mining and analysis are becoming key tools to help the retail and entertainment industries recover from the downturn caused by the pandemic. "If you want to spend money, don't you want to spend it as accurately as possible?" he said. "I think this is the benefit of data."