UK: How Retailers Are Using Technology To Survive (And Thrive!)

Last Updated: 12 December 2013
Article by Robyn Chatwood and Juma Weeks

Summary and implications

Retailers are adopting innovative technology as a core strategy to survive in the tough economic market. We have observed a number of key technological trends emerging in the retail sector which benefit retailers, landlords and consumers. This article summarises some of the innovations, and their legal risk and implications, which may help some players survive and thrive.

Key trends

Emerging technologies are being employed to improve the consumer's retail experience. These also benefit businesses through gathering and sharing data about the demographic of consumers and their buying habits. Here are some examples:

Virtual changing rooms

Topshop, John Lewis and other retailers are trialling "virtual mirrors" at flagship stores. This technology uses built-in cameras to capture moving images of a consumer which are then superimposed with clothing over the on-screen image; consumers can "try on" clothing without getting undressed. Marks & Spencer have also successfully deployed this for make-up through a "virtual makeover counter". A consumer identifies a style or range of products they like and the virtual mirror suggests other complimentary products the consumer may wish to purchase. Images can be shared on social media or via email. Some retailers have enabled the mirrors to double-up as a kiosk enabling stock availability checks and facilitating online orders.

Point of sale technology

Another trend not yet fully exploited (but growing rapidly) is the use of mobile point of sale terminals. Unlike self-service kiosks, this still requires in-store staff. Benefits include cutting queuing time and increased sales as the store is able to bring the point of sale to the consumer, making the sales process simple and efficient. This technology was pioneered by Apple and is used in all of its retail stores. Other larger retailers such as Nordstrom in the US, have also successfully used mobile point of sale terminals.

Related item:

Payments Council Report "UK Payment Markets 2013"

Press release relating to the Payments Council's Report. More

Electronic payments

Year on year, the proportion of payments made by cash compared to electronic card payments has fallen. "Near-field communications" has been widely adopted in the last year to deliver payments wirelessly via the Visa contactless platform. This e-payments trend is set to continue with the rise of smartphone mobile payments. According to a report published by the Payments Council in August 2013, such payments will become the major payment channel. It is envisaged that by 2022, the number of payments made by this method will quadruple to an estimated 1.5bn payment transactions in the UK alone. As new mobile phones are released which incorporate this technology, consumers will demand compatibility at point of sale terminals in retail outlets. Electronic payments inevitably contain vast quantities of personal data about the consumer making the payment. Smart retailers are capitalising on the opportunity to learn more about their customers and their shopping habits. Early adopters of this technology have partnered with mobile network operators to share data for use in direct/tailored advertising and in-store promotions. They are incorporating loyalty schemes and using the data to cross-sell more effectively.

"Tracking" customers

The final key trend we have seen is tracking customer traffic. Brick-and-mortar retailers have, for some time, been disadvantaged in relation to the data and information they collect on consumers compared with e-commerce operators.

To tackle this problem, innovative technologies are being developed and deployed by larger retailers in their physical locations. One such technology, known as "tracking", uses smartphone wi-fi signals to track shoppers as they move through a store or a shopping centre. Using this technology, retailers can count the number of consumers entering a store, identify which parts of a store are most popular and gather data about shoppers' behaviour which can be useful for future marketing and product promotions. Shopping centre owners can also use this technology to identify larger trends, such as how the placement of advertising affects consumers' movements within a shopping centre, which retailers complement others, how many consumers are repeat visitors and their visit frequency. Some retailers are using this data to offer additional services, such as sending reminders about promotions or the expiry of parking bays. Another value to the information collected is the understanding it provides about the relationship between consumers' movements within a shopping centre and turnover at particular stores.

Key legal risks

The use of these technologies in the retail sector presents considerable legal challenges. Quite simply, the present data protection regime does not facilitate the collection and use of data in such vast quantities and in as much breadth.

One of the more difficult legal challenges is obtaining appropriate consent from a shopper to use their data for the particular purposes that retailers intend. For example, consumers may not expect to receive targeted marketing material after using their smartphone to pay for an item in-store. This could be seen as an unwanted service or use of their data. Care is needed by data controllers to ensure the data collected is used lawfully and that consumers' rights to opt out of such marketing are preserved. Similarly, consent of the individuals may be an issue in relation to "tracking" consumers' movements through a shop or shopping centre. Any retailer or landlord considering using this technology should review the need to alert shoppers (e.g. by signage) and anonymise data collected, if necessary. These steps will mitigate the risk of breaching current data protection laws in the UK and EU.

There are a large number of data protection issues relating to the storing, processing and transfer of the data collected using these new technologies. In particular, to ensure compliance with current UK and EU laws, any data sharing partnerships should be subject to a written data transfer agreement setting out the roles of each party, the types of data to be transferred and how the data will be stored and processed. It is vital that data protection advice is sought in relation to internal policies and contractual provisions before any new technologies are deployed.

Another key legal task is to ensure that, in the rush to acquire and use such consumer data, there is clarity about who has what rights to use, own, distribute and compile data and databases derived from its collection. Robust contractual provisions are crucial to avoid future disputes and ensure rights are as intended as between landlords, retailers, technology providers and consumers.


The emerging trends present excellent opportunities for retailers, landlords, shopping centre owners and consumers. Early adopters of these technologies may well see the greatest benefits, but, in the present legal environment, they also face the greatest risks. Given the many legal and commercial/reputational risks involved (such as data protection issues, intellectual property rights allocation and cyber security), care is required. Appropriate contracts, internal policies and legal safeguards should be put in place to ensure full compliance. Nabarro can assist you with advice in these matters.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.