• by Wendy Davis  @wendyndavis, July 16, 2013

Technology companies that track consumers as they shop in brick-and-mortar stores will work with privacy advocates, regulators and the think tank Future of Privacy Forum to develop a code of conduct aimed at protecting consumers' privacy, the organization said on Tuesday.

The goal is to develop a set of best practices by November, according to Future of Privacy Forum director Jules Polonetsky. He adds that the new code will spell out requirements about how to de-identify data so that it can't be linked back to individuals.

The code also will address the best ways to notify consumers about the tracking, and allow them to control whether or not their location is recorded.

The companies that will participate in the initiative include Euclid, WirelessWERX, Mexia Interactive and ShopperTrak. They currently are able to track consumers in stores and shopping centers through smartphones, which broadcast location information when the WiFi or Bluetooth functions are turned on. That data is shared in aggregate form with retailers like Nordstrom and Home Depot.

The retailers say they use the information to make their stores run more efficiently. For instance, if the data shows long checkout lines at particular times of day, the stores could add cashiers during those times.

But the technology has raised the eyebrows of consumers, as well as some lawmakers. Sen. Al Franken (D-Minn.) said earlier this year that companies should not track consumers' locations in retail environments without first obtaining opt-in consent.

One way that people who don't want to be tracked can block the technology is by turning off their smartphone's WiFi and Bluetooth. But Polonetsky says the companies that offer the tracking systems want to give people the ability to opt out without turning off the WiFi or Bluetooth functions.