PARIS: French retailers in the fiercely competitive luxury sector are gathering data about their customers via ingenious technology, such as connected displays and smartphone monitors, but they have to tread carefully because of privacy concerns.

Speaking to the Financial Times, executives from some retail specialist tech start-ups have revealed how they are helping the grand department stores of Paris.

According to them, some of the flagship stores on the Champs-Élysées and other Grands Boulevards have been testing technology to collect data about shoppers in much the same way as online retailers use cookies in web browsers.

"A lot of brands want to break down the barriers between their digital and physical presence," explained Clémence Dehaene, co-founder of Retail & Digital 2.0, a company that integrates motion sensors, screens and other elements into luxury retail displays.

"If a brand manages to mix the efficiency of digital with the emotional aspect of a physical store then they have a real card to play," she added.

Specifically, her company provides motion-activated screens that tell retailers and brands about which products their customers have picked up in-store.

Retency, another French start-up, supplies retailers with antennas that can pinpoint the unique frequencies of individual smartphones, which enables them to track a customer's journey through a store.

The smartphone detectors also help them to calculate the proportion of people who entered a store after seeing a display as well as how many went on to make a purchase.

"Luxury brands have a lot of information about their clients, but don't make the connection [between a shopper and their customer profile] until checkout," said Isabelle Bordry, co-founder of Retency.

"It's essential for physical retailers to have access to the same information as they would online," she added.

She said Retency's technology can identify the smartphones of shoppers who make a purchase by cross-referencing sales records with the data from the smartphone frequency antennas. And she claims this can help luxury retailers to fine-tune promotions in real time.

However, despite the benefits these capabilities may bring, luxury retailers still need to respect their customers' privacy, comply with strict French consumer regulations while continuing to maintain their reputation for customer discretion.

"The respect of privacy is a key aspect of the luxury business," warned George-Edouard Dias, a former L'Oréal executive and co-founder of QuantStreams.

Data sourced from Financial Times; additional content by Warc staff