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Faster scans, more savings

Beaverton company, Digimarc, is taking us a step closer to the Internet of Things

Digimarc, the Beaverton company that makes watermarking software for physical products and media, thinks it has a way to save high volume retailers $4 billion annually.

Digimarc Barcode debuted in January at the National Retail Federation. The firm is currently pushing the technology as the missing link that will speed up supermarket checkout times.

The software takes the standard bar code that is on every product – the GTIN or global trade item number – and converts it into a new image that is printed all over the packaging but is not visible to the naked eye. The print on your Raisin Bran box or fish oil pellet tub might look normal, but someone looking with a magnifying glass might see a faint pattern caused by slightly tweaking the color scheme. A three camera scanner in the Point Of Sale machine can read this quicker and more reliably than the old striped rectangle, thus speeding up checkout and reducing cashier hours.

“We talked to a lot of clerks who said it would cut down on a lot of injury claims because they won’t have to do this any more,” says Ed Knudson, SVP of Sales and Marketing at Digimarc, making the swirling motion that cashiers make as they try to engage the barcode with the scanner. “It will also improve eye contact, “ he adds.

The real driver, however, is cost savings to the retailer. Digimarc’s quantitative model, based on the top 120 high volume retailers (the likes of Walmart, Costco and Fred Meyer) estimates that clerks will scan 33 percent to 50 percent faster, amounting to $4 billion in savings worldwide. “The retailers may choose to harvest that any way, by reducing hours, or prices, or treating it as a customer service.”

As a publicity stunt earlier this year, the company set the Guinness World Record for fastest time to scan and bag 50 items. The rules included exactly 10 items per bag, two clerks who had to switch places half-way through, and the final item had to be the Guinness Book of World Records.


Such watermarking is more useful as we enter the era of the Internet of Things (IoT), where almost anything can transmit data about itself to the Internet. Everything on a supermarket shelf could be alive with data.

Consumers can use their smart phone cameras to scan a product and instantly add it to a shopping list. This is a bit more intuitive than using a smart fridge that, like a Las Vegas mini bar, is supposed to know when your supplies are running low.

Knudson explained that it took the bar code seven years to become established. Retailers formed a consortium and funded its mass adoption. Whereas this method could be adopted far more quickly because it leverages technology already in place. GT1, which manages the GTIN system, doesn’t need to change, nor do the point of sale scanners, which are already moving over to a multiple camera system. Retailers would have access to a Software Developers Kit (SDK) to adapt the technology to their use. And it’s still just ink on paper - graphic designers at the packaging companies would simply download a plug in for Photoshop which then adds the invisible image to their work.

Digimarc is hoping to persuade retailers to start by putting the watermarks on the brands they control – the generics or private label goods like Kirkland, Kroger and Trader Joe’s. If that works they will have data to show the packaged goods companies like Kraft how valuable it is.

As well as speeding four-cart families though Costco, it in particular promises to work well with medications. Pharmacists already count and package drugs into blister packs. The packaging could also contain the name of the patient and the drug expiration date in the barcode. “That means track and trace and recalls are possible,” Knudson adds.

Digimarc applied the same principle to electronic media signals starting in 2013. A tone inaudible to humans can be added to the music playing in a store, allowing customers to pull up coupons or extra information on the phones. One speaker in apparel might have a different tone from another in home and garden, pushing a different product, although to the naked ear they are both playing the same Gen X ear candy.

Knudson demoed a TV for a fictional coffee brand, upon which three different signals piggy backed in three ten second bursts. Whether it was roasting information or a chance to win a trip to Brazil, the aim was to exploit second screen engagement – the modern habit of browsing on a mobile device while watching TV.

So far this watermarking technology has been used in Ford’s 2014 brochures, and in magazines such as Cooking Light to scan food photos to get recipes and storable shopping lists. Publishers pay a flat fee then an annual license fee to use it.

Another idea is a scannable image of your credit/debit card on your phone for use at checkout. The fact that it’s actually a video, wobbling at 15 frames per second, makes it almost impossible to screen grab and abuse.

Users opt in by turning on the Digimarc Discover mobile app, which can hear as well as see. There are already apps by other companies that “listen in” as you watch TV. They can tell what you are watching and bring up relevant ads and content. The company tried this in a joint venture with ratings system Nielsen two years ago, adding a signal to a Weather Channel show called Over the Edge about dangerous situations, but pulled the plug. The company may have 350 watermarking patents and 400 more in process, but it’s hard predicting what will be a hit with the public.