security-cams

Of the current class of hot “omni-channel” startups, Nomi has managed to gather a lot of venture funding and press attention. (It has also managed to gather an impressive roster of 70 clients.)

Today, the company announced it has taken advantage of the new iPhone tracking capabilities rolled out by Apple last year: Nomi has launched Nomi Mobile, which gives clients the ability to include tracking in their own apps. Correction: Nomi Mobile gives clients the ability “to send a promotion when any customer who has opted in approaches the beacon,” Barrow says.

Obviously there are major privacy concerns about this kind of mobile marketing. No one likes the idea of brands and whoever else knowing where they are via their smartphone. But Nomi’s co-founder and CRO Wesley Barrow says most concerns are alleviated once they learn how the tracking actually works.

As it stands, Nomi’s technology works as such: Stores implement hardware from Nomi which includes a camera at the door to count how many people enter and exit (just about all stores have security cameras already). Nomi then uses “in-store wifi based sensors” to pick up on a phone’s UDID. Correction: Nomi uses MAC Addresses, a different kind of unique identifier, which stands for media access control. The UDID, or Unique Device Identifier, is basically like an IP address for your phone and has raised some sensitivities. That can raise some sensitivities. For example, Apple’s App Store does not allow apps to take and track UDID numbers.

Nomi is tracking people by their MAC numbers and they don’t know it. Update: Nomi says it provides store owners signage with which to inform customers. Nomi’s argument is the same argument many marketers make: The MAC has no context and no personally identifiable information, so it is anonymous. The only benefit of tracking it is to know whether a person is a repeat visitor. Its just like with a Web site, Barrow argues. For example, on Pando, we can see that an IP address has visited our site. We can see what time, for how long, and from where in the world they’re visiting. We can see how many times they’re visiting. But we don’t know who that person is or anything else about them. That’s the extent of the data collected, Barrow says.

Knowing how many people enter and exit, and where they go in the store, how long they spend, and matching that up against sales, is valuable enough information to retailers that Nomi has racked up 70 customers, some of which have thousands of stores, including restaurant chains and auto dealers. They pay between $150 and $300 per month per store for access to the data and analytics that Nomi’s hardware spits out.

But of course, marketers want more than just cold data. They want to be able to market to the people carrying those phones, based on where they are in the store, and what their profile and shopping histories are. That kind of granular marketing requires getting permission — it’s got to be opt-in.

Apple itself has started doing this kind of marketing in its own stores using a protocol called iBeacon. If you’ve downloaded the Apple Store app, iBeacon will track you and send targeted messages (or maybe deals) while you’re in the Apple store.

With Nomi Mobile, Nomi has built its own version of this, on the premise that Apple isn’t going to build out an enterprise suite to offer this for other stores (though it is already being used in some grocery stores). Nomi Mobile is an SDK that allows any store to make its app location-aware. So if Wal-Mart has its own app, anyone who has downloaded it (and given permission to track) has the ability to get a push notification from the app the minute they walk through in the door. This idea has been considered the Holy Grail of mobile marketing for years now.

Nomi has rolled out the technology to five clients already, Barrows says.

[Image via shannonkringen on Flickr]

  1. Nomi
    Helping retailers bridge the gap between online and offline
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    Nomi helps retailers bridge the gap between online and offline so they can better engage their customers.

    1. David Tisch
      Past Investor