6 ms·

The Most Powerful Sales Tool at Lowe's: Satellites

31 points by 1337biz 13y ago

mrfusion 13y ago
How about if a hardware chain used satellite imagery to detect new structures being built, like sheds, barns, etc, and mailed targeted coupons out to the property owners?
- TheCraiggers 13y ago
  Isn't that a bit late in many respects though? The holy grail for a hardware company would be knowing when a person was thinking about building a new shed, barn, etc, not when they've already bought all the wood and nails to begin construction. That said, we already know they're trying their damnedest to track just that.
  - vailripper 13y ago
    Isn't permitting info in the public domain? I wonder why they don't leverage that?
    - noir_lord 13y ago
      Here in the UK public domain does not equal easy to get. Planning applications are available for viewing at the local planning office but they are not available online (though I know a guy who works at the local council who is pushing for them to put all their data online as part of the open government initiative so change is slowly coming here).
    - mrfusion 13y ago
      Good point. I wonder if that's a startup idea there? Go to local city halls and gather permitting information to sell to retailers?
      - dandelany 13y ago
        Shameless plug - the company I work for is (sort of) doing this for tons of public data sources. http://enigma.io http://enigma.io
    - TheCraiggers 13y ago
      A good question. My assumption is that even though it's considered public knowledge, there is still a cost for it and it's not electronic. For instance, in my state and/or township one can go to township office and request a copy of all the property taxes for any piece of land, no matter who owns it. It costs something like ten dollars and in return you get a hardcopy with a bunch of numbers on it. Assuming the process for getting copies of new permits is similar, the biggest downside is cost for the information and paying for some intern or whatever to type it in. Even if it's five dollars plus intern is decent chunk of money (I have no idea what the profit margin is on lumber, etc). And then you have to factor in the cost of the promotion which will eat into yet more profits.
      - drone 13y ago
        In Houston, it's electronic and searchable. See: http://www.cohtora.houstontx.gov/ibi_apps/WFServlet?IBIF_ex=online_permit_start http://www.cohtora.houstontx.gov/ibi_apps/WFServlet?IBIF_ex=...
  - dredmorbius 13y ago
    when a person was thinking about building Such as when they file a building permit request. Which I suspect may be public information in many jurisdictions.
- chiph 13y ago
  They might want to monitor building permits, so they can get in ahead of when actual construction starts. Also - the gold coupon is the 10% off one from Lowes that comes in the US Postal Service change of address packet.
  - drone 13y ago
    Monitoring just issued permits may only useful if the home owner is the one doing the work (which is often, but in large metro areas, may be a very small subset of the actual permits being issued). Contractors tend to have their own suppliers for their materials. Not to mention, that often, by the time permitting process is started, much of the materials, appliances, etc. have already been chosen, so coupons only work if they're relevant to the chosen materials/appliances/etc. (Anecdotally, I'm going through this right now. The permitting process takes so long, that nearly every thing is already decided on by the time the permits are issued.) I think useful permit indicator is to look at recent past permits. Neighbors tend to be inspired by their neighbors to do long-needed projects. As soon as I started talking about doing work on my house, other neighbors started asking for the name of my contractor and started talking about how maybe they should "fix up that garage, or re-do the kitchen."
    - chiph 13y ago
      That's not a bad idea. I think addresses can be matched to postal delivery routes, so they could be a little more targeted with their mailing.
dmd 13y ago
I'm puzzled why they would go to the expense of using real time satellite imagery for this, versus mounting a camera on a light pole in the parking lot.
- kfcm 13y ago
  This is the exact same thought I had when reading the story. Not only would it be cheaper, but you could follow each vehicle through the lot and figure out the traffic flow patterns better. Plus, to tie in with this other front-page story ( https://news.ycombinator.com/item?id=7346629 https://news.ycombinator.com/item?id=7346629 ), you could track the plates of the cars, and tie that in with retail cellular tracking ( https://news.ycombinator.com/item?id=5154089 https://news.ycombinator.com/item?id=5154089 ). Facial recognition still needs a couple of years. Over time, you could tie the cellular phone, vehicle, and electronic payment (debit or credit card) to an individual. Continual tracking. And all brought to you by technology. In the words of Pogo: "We have met the enemy...and he is us."
  - k2enemy 13y ago
    That, and you can see the parking lot on cloudy days too.
  - craigching 13y ago
    > you could track the plates of the cars, and tie that in with retail cellular tracking ... Facial recognition still needs a couple of years. Over time, you could tie the cellular phone, vehicle, and electronic payment (debit or credit card) to an individual. Continual tracking. No thanks. The day that happens is the day I stop shopping there. That would be the "creepy" mentioned in the story.
- baldeagle 13y ago
  I would guess ease of roll out. It is a MVP, a test that could be run on a large batch of store without having to wait on a bunch of hardware being installed. It likely offers a similar picture to the alogrithyms, making the mining less difficult. Since it is proving worthy, parking lot cameras might be next.
rollthehard6 13y ago
It doesn't sound like it would make sense to do this given that stores generally have counters on the readers that detect stolen tagged items on exit. Surely it would be easier to use this data to figure out when the busy periods fall?
joebo 13y ago
Why not track how many times the entrance/exit doors open or close? Or add a laser(?) that cuts across the entrance that counts each time it's line is broken. Directional but also simple to do.
- Shivetya 13y ago
  you would need to account for employee traffic then, plus customers who run back in on the occasional oops I forgot
- Naga 13y ago
  A lot of companies do this actually. Sure its not perfect, but it gives a good enough estimate.
maxerickson 13y ago
The actual information is less exciting: Laura Champine - Canaccord Good morning. Thanks for taking my question. Your close rate performance was impressive, how do you measure that? Bob Hull - Chief Financial Officer Laura, so a couple of different ways, so of late, we have been using satellite imagery. So we take pictures of parking lots throughout the course of the year. We max that up with actual transaction counts in stores. Of late we have been actually using some technology that involves traffic counters in the stores, which gives us close rate by day, by hour, which is going to further allow Rick and the team to optimize labor going forward. We have tested both methodologies for the same stores and got similar results. We are pretty comfortable with the methodology. It allows us to forecast and see actual improvement in close rates From the earnings call: http://seekingalpha.com/article/2051323-lowes-companies-ceo-discusses-q4-2013-results-earnings-call-transcript?page=7&p=qanda&l=last http://seekingalpha.com/article/2051323-lowes-companies-ceo-...
mkmk 13y ago
Kroger uses infrared near the checkout lines to similar effect: http://www.timesdispatch.com/business/retail/infrared-technology-cuts-kroger-checkout-time/ http://www.timesdispatch.com/business/retail/infrared-techno...
squigs25 13y ago
really cool? yes. Impractical? probably? Scanning earth using satellites is really cool. Maybe they're outsourcing this to a central company, and paying a hundred bucks per store per month. fine. But to be honest, there are some more effective low tech ways to catch these numbers, for example by looking at the number of transactions, or installing sensors on every entrance to count the number of people entering. Seems like they're shooting a pigeon with a cannon.
- kej 13y ago
  >But to be honest, there are some more effective low tech ways to catch these numbers Heck, just have someone count cars and write down the time whenever they retrieve shopping carts from the parking lot.
- rayiner 13y ago
  You think any of that is as cheap as a hundred bucks a month per store?
gadders 13y ago
>> "A little creepy? Yeah. Smart? Definitely." Is it creepy? They're only looking at car park occupancy in aggregate. They're not tracking car number plates.
- protomyth 13y ago
  I don't get the creepy either. It seems like an ok plan to judge volume[1] of traffic compared to sales. Might even do some analysis of what vehicle types are going to the store. 1) I am with other posters and would have put up security cameras and done my count that way
- craigching 13y ago
  As long as I don't start getting "we noticed you parked in our parking lot but didn't buy anything ..." e-mails, I'm totally ok with it ;)
- skywhopper 13y ago
  I thought the story was going to be about Lowe's using satellite imagery of neighborhoods to decide where to target marketing about new roofs, outbuildings, lawn care, sidewalk maintenance, etc. So yeah, using it to watch their own parking lots is... not creepy at all.
incision 13y ago
Neat. Satellite imagery isn't terribly expensive and Lowes has 1830 stores. I'd bet it's a lot more efficient in the end to just buy a consistent set of images for X stores of interest, X times a year than worry about the installation, maintenance of location specific concerns of cameras/sensors at every store.
suprgeek 13y ago
"Satellite imagery" is the most powerful Sales Tool? I understand the need for "link-baity" headlines but this is flat-out wrong. The very same article goes on to state some numbers - 1% improvement vs 2% reduced labor. If they can attribute it ALL to Satellite Tracking as opposed to say other promotions/general economy & barring other accounting tricks, it is still too little to be even attributable.
- lostlogin 13y ago
  At the hospital I work at we correlate 'sales'in a similar way. Just we found a cheaper way. We noticed that at night less people come in. So we reduced staffing at night.
rickdale 13y ago
Hm, what the article doesn't say is that Lowes are typically located near Home Depot. Definitely close enough to get a snapshot of competitors parking lot too.
gstar 13y ago
I don't understand why they don't correlate EPOS, door and aisle counters, put it in their data warehouse, and have precise close rate based on 1) visits 2) store departments I'd have thought this was totally standard practice! Still though, really cool that they have confidence that satellite imagery is a good proxy for this.

31 points by 1337biz 13y ago

How about if a hardware chain used satellite imagery to detect new structures being built, like sheds, barns, etc, and mailed targeted coupons out to the property owners?

TheCraiggers 13y ago
Isn't that a bit late in many respects though? The holy grail for a hardware company would be knowing when a person was thinking about building a new shed, barn, etc, not when they've already bought all the wood and nails to begin construction. That said, we already know they're trying their damnedest to track just that.
- vailripper 13y ago
  Isn't permitting info in the public domain? I wonder why they don't leverage that?
  - noir_lord 13y ago
    Here in the UK public domain does not equal easy to get. Planning applications are available for viewing at the local planning office but they are not available online (though I know a guy who works at the local council who is pushing for them to put all their data online as part of the open government initiative so change is slowly coming here).
  - mrfusion 13y ago
    Good point. I wonder if that's a startup idea there? Go to local city halls and gather permitting information to sell to retailers?
    - dandelany 13y ago
      Shameless plug - the company I work for is (sort of) doing this for tons of public data sources. http://enigma.io http://enigma.io
  - TheCraiggers 13y ago
    A good question. My assumption is that even though it's considered public knowledge, there is still a cost for it and it's not electronic. For instance, in my state and/or township one can go to township office and request a copy of all the property taxes for any piece of land, no matter who owns it. It costs something like ten dollars and in return you get a hardcopy with a bunch of numbers on it. Assuming the process for getting copies of new permits is similar, the biggest downside is cost for the information and paying for some intern or whatever to type it in. Even if it's five dollars plus intern is decent chunk of money (I have no idea what the profit margin is on lumber, etc). And then you have to factor in the cost of the promotion which will eat into yet more profits.
    - drone 13y ago
      In Houston, it's electronic and searchable. See: http://www.cohtora.houstontx.gov/ibi_apps/WFServlet?IBIF_ex=online_permit_start http://www.cohtora.houstontx.gov/ibi_apps/WFServlet?IBIF_ex=...
- dredmorbius 13y ago
  when a person was thinking about building Such as when they file a building permit request. Which I suspect may be public information in many jurisdictions.
chiph 13y ago
They might want to monitor building permits, so they can get in ahead of when actual construction starts. Also - the gold coupon is the 10% off one from Lowes that comes in the US Postal Service change of address packet.
- drone 13y ago
  Monitoring just issued permits may only useful if the home owner is the one doing the work (which is often, but in large metro areas, may be a very small subset of the actual permits being issued). Contractors tend to have their own suppliers for their materials. Not to mention, that often, by the time permitting process is started, much of the materials, appliances, etc. have already been chosen, so coupons only work if they're relevant to the chosen materials/appliances/etc. (Anecdotally, I'm going through this right now. The permitting process takes so long, that nearly every thing is already decided on by the time the permits are issued.) I think useful permit indicator is to look at recent past permits. Neighbors tend to be inspired by their neighbors to do long-needed projects. As soon as I started talking about doing work on my house, other neighbors started asking for the name of my contractor and started talking about how maybe they should "fix up that garage, or re-do the kitchen."
  - chiph 13y ago
    That's not a bad idea. I think addresses can be matched to postal delivery routes, so they could be a little more targeted with their mailing.

dmd 13y ago

I'm puzzled why they would go to the expense of using real time satellite imagery for this, versus mounting a camera on a light pole in the parking lot.

kfcm 13y ago
This is the exact same thought I had when reading the story. Not only would it be cheaper, but you could follow each vehicle through the lot and figure out the traffic flow patterns better. Plus, to tie in with this other front-page story ( https://news.ycombinator.com/item?id=7346629 https://news.ycombinator.com/item?id=7346629 ), you could track the plates of the cars, and tie that in with retail cellular tracking ( https://news.ycombinator.com/item?id=5154089 https://news.ycombinator.com/item?id=5154089 ). Facial recognition still needs a couple of years. Over time, you could tie the cellular phone, vehicle, and electronic payment (debit or credit card) to an individual. Continual tracking. And all brought to you by technology. In the words of Pogo: "We have met the enemy...and he is us."
- k2enemy 13y ago
  That, and you can see the parking lot on cloudy days too.
- craigching 13y ago
  > you could track the plates of the cars, and tie that in with retail cellular tracking ... Facial recognition still needs a couple of years. Over time, you could tie the cellular phone, vehicle, and electronic payment (debit or credit card) to an individual. Continual tracking. No thanks. The day that happens is the day I stop shopping there. That would be the "creepy" mentioned in the story.
baldeagle 13y ago
I would guess ease of roll out. It is a MVP, a test that could be run on a large batch of store without having to wait on a bunch of hardware being installed. It likely offers a similar picture to the alogrithyms, making the mining less difficult. Since it is proving worthy, parking lot cameras might be next.

rollthehard6 13y ago

It doesn't sound like it would make sense to do this given that stores generally have counters on the readers that detect stolen tagged items on exit. Surely it would be easier to use this data to figure out when the busy periods fall?

joebo 13y ago

Why not track how many times the entrance/exit doors open or close? Or add a laser(?) that cuts across the entrance that counts each time it's line is broken. Directional but also simple to do.

Shivetya 13y ago
you would need to account for employee traffic then, plus customers who run back in on the occasional oops I forgot
Naga 13y ago
A lot of companies do this actually. Sure its not perfect, but it gives a good enough estimate.

maxerickson 13y ago

The actual information is less exciting: Laura Champine - Canaccord Good morning. Thanks for taking my question. Your close rate performance was impressive, how do you measure that? Bob Hull - Chief Financial Officer Laura, so a couple of different ways, so of late, we have been using satellite imagery. So we take pictures of parking lots throughout the course of the year. We max that up with actual transaction counts in stores. Of late we have been actually using some technology that involves traffic counters in the stores, which gives us close rate by day, by hour, which is going to further allow Rick and the team to optimize labor going forward. We have tested both methodologies for the same stores and got similar results. We are pretty comfortable with the methodology. It allows us to forecast and see actual improvement in close rates From the earnings call: http://seekingalpha.com/article/2051323-lowes-companies-ceo-discusses-q4-2013-results-earnings-call-transcript?page=7&p=qanda&l=last http://seekingalpha.com/article/2051323-lowes-companies-ceo-...

mkmk 13y ago

Kroger uses infrared near the checkout lines to similar effect: http://www.timesdispatch.com/business/retail/infrared-technology-cuts-kroger-checkout-time/ http://www.timesdispatch.com/business/retail/infrared-techno...

squigs25 13y ago

really cool? yes. Impractical? probably? Scanning earth using satellites is really cool. Maybe they're outsourcing this to a central company, and paying a hundred bucks per store per month. fine. But to be honest, there are some more effective low tech ways to catch these numbers, for example by looking at the number of transactions, or installing sensors on every entrance to count the number of people entering. Seems like they're shooting a pigeon with a cannon.

kej 13y ago
>But to be honest, there are some more effective low tech ways to catch these numbers Heck, just have someone count cars and write down the time whenever they retrieve shopping carts from the parking lot.
rayiner 13y ago
You think any of that is as cheap as a hundred bucks a month per store?

gadders 13y ago

>> "A little creepy? Yeah. Smart? Definitely." Is it creepy? They're only looking at car park occupancy in aggregate. They're not tracking car number plates.

protomyth 13y ago
I don't get the creepy either. It seems like an ok plan to judge volume[1] of traffic compared to sales. Might even do some analysis of what vehicle types are going to the store. 1) I am with other posters and would have put up security cameras and done my count that way
craigching 13y ago
As long as I don't start getting "we noticed you parked in our parking lot but didn't buy anything ..." e-mails, I'm totally ok with it ;)
skywhopper 13y ago
I thought the story was going to be about Lowe's using satellite imagery of neighborhoods to decide where to target marketing about new roofs, outbuildings, lawn care, sidewalk maintenance, etc. So yeah, using it to watch their own parking lots is... not creepy at all.

incision 13y ago

Neat. Satellite imagery isn't terribly expensive and Lowes has 1830 stores. I'd bet it's a lot more efficient in the end to just buy a consistent set of images for X stores of interest, X times a year than worry about the installation, maintenance of location specific concerns of cameras/sensors at every store.

suprgeek 13y ago

"Satellite imagery" is the most powerful Sales Tool? I understand the need for "link-baity" headlines but this is flat-out wrong. The very same article goes on to state some numbers - 1% improvement vs 2% reduced labor. If they can attribute it ALL to Satellite Tracking as opposed to say other promotions/general economy & barring other accounting tricks, it is still too little to be even attributable.

lostlogin 13y ago
At the hospital I work at we correlate 'sales'in a similar way. Just we found a cheaper way. We noticed that at night less people come in. So we reduced staffing at night.

rickdale 13y ago

Hm, what the article doesn't say is that Lowes are typically located near Home Depot. Definitely close enough to get a snapshot of competitors parking lot too.

gstar 13y ago

I don't understand why they don't correlate EPOS, door and aisle counters, put it in their data warehouse, and have precise close rate based on 1) visits 2) store departments I'd have thought this was totally standard practice! Still though, really cool that they have confidence that satellite imagery is a good proxy for this.