Mar 18, 2024 - Business

Retailers pile on new tech to deter theft

Illustration of a brown paper shopping bag covered in front door locks.

Illustration: Annelise Capossela/Axios

Locked cases, security turnstiles, AI-equipped cameras, receipt scanners, off-duty cops, license plate recognition — retailers are piling on anti-theft technologies as shoppers grit their teeth.

Why it matters: Striking the right "convenience vs. security" balance is critical for retailers, who need to thwart shoplifting without turning off legit customers.

Driving the news: Stores are taking increasingly muscular loss-prevention measures.

  • In Washington, D.C., some Giant and Safeway supermarkets are locking up items, installing security gates and checking customers' receipts before they leave.
  • New York City drugstores are so rife with plastic lockup cases that one crook was forced to use a blowtorch to blast one open, making off with $448 in skin care products.
  • Under Lowe's' "Project Unlock," you can't use your new power drill unless it's been activated at the register.

Friction point: Such anti-theft efforts can deter legit consumers.

  • Retailers "know that locking up items does impact their sales," says David Johnston, vice president of asset protection and retail operations at the National Retail Federation.
  • "They spend millions of dollars on displays and creating the shopping experience," he notes. Locking up merchandise is "something they really don't want to do."
  • Retailers are "looking at various technologies that allow them the freedom of a positive shopping experience, with the control of inventory," Johnston says.

Case in point: "Anti-sweeping" shelves use rails, tracks or sensors to keep people from grabbing lots of items at once.

  • New AI cameras use "loitering analytics" and face-matching tech designed to spot known offenders.
  • RFID systems — which mark each item with a tiny tag about the size of a piece of glitter — are increasingly used to track stolen merchandise.
  • Audio detection alerts store managers to the sound of gunshots or breaking glass.
  • "Pushout prevention" systems lock shopping carts before they exit a store.
  • License plate recognition cameras monitor store parking lots.

Zoom in: Some stores are deploying the Freedom Case, which shoppers can unlock by sharing their phone number or using the store's loyalty app.

  • "You're making this value exchange," Joe Budano, CEO of Freedom Case maker Indyme, tells Axios.
  • "You're trading some form of personal information" for the ability to take a product yourself — which 85% of people do, the company says.
A small screen on a locked store display asks shoppers to either call a store associate or use their phone to unlock the case.
A Freedom Case invites shoppers to give personal information in order to unlock a store shelf without assistance. Photo courtesy of Indyme

Between the lines: Today's security camera technology, meanwhile, is "much more searchable" with "much greater resolution," says Read Hayes, director of the Loss Prevention Research Council, which lab-tests anti-theft products.

  • AI obviates the need to watch eight hours of video to find a thief — it can flag suspicious behavior in real time, Hayes tells Axios.

Yes, but: Stores must be mindful of privacy concerns and false accusations.

  • Case in point: Rite Aid was recently barred from using facial recognition for five years after the Federal Trade Commission found that its system erroneously flagged people of color as shoplifters.

Reality check: A tiny number of shoplifters account for the vast majority of the crimes — but everyone suffers when shampoo and toothpaste gets locked behind barriers.

  • Store clerks suffer very real trauma from violence and threats against them.

Threat level: Some consumers complain that physical stores are putting themselves out of business with heavy-handed security.

  • On the other hand, there's sympathy and understanding for store owners, according to surveys from the Loss Prevention Research Council.
  • "I think people are saying, 'You know, these poor places are losing so much — they've got to protect themselves," says Hayes, who's also a criminologist at the University of Florida.

What's next: Stores of the future could develop a TSA-type system in which trusted shoppers gain easier access to shelves, dressing rooms, self-checkout and more, Budano says.

  • Verified shoppers — who might one day be recognized by AI cameras — could get a green light to use the store freely.

The bottom line: The latest anti-theft technologies deter thieves and catch criminals, experts say — so expect to see more of them.

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