Some Macy’s (FD ), CVS (CVS ), and Babies ‘R’ Us stores have installed a system called the Video Investigator, whose advanced surveillance software can compare a shopper’s movements between video images and recognize unusual activity.

Remove 10 items from a shelf at once, for instance, or open a case that’s normally kept closed and locked, and the system alerts guards sitting in a back room — or pacing the sales floor — with a chime or flashing screen. The system can predict where a shoplifter is likely to hide (at the ends of aisles, behind floor displays). A search function spots sudden movement that might indicate a large spill, prompting workers to clean up before it leads to a slip-and-fall accident and a costly lawsuit. And if someone opens a back door at 2 a.m., the system will record who sneaked in and link it with snapshots of the previous and next persons to use the door. Alerts, complete with images, can be sent to handheld devices, keeping retailers informed 24/7, says the firm that makes the Video Investigator system.

Store managers these days need all the high-tech help they can get. Increasingly, they’re under assault from organized gangs of professional shoplifters. These skilled thieves walk off with huge amounts of selected items and resell them at discounts.

To fight back, store chains are embedding smarter devices everywhere, from checkout stands to shelves to places you wouldn’t even think of (and can’t see). At the same time, more of these systems are talking to each other, sharing data about shoppers and employees alike.

Many criminals aren’t stupid, of course, so the name of the game for surveillance experts is making their wares all but invisible. Some of the most powerful sensor systems are being embedded right under your nose. Take those beige plastic discs that retailers snap onto clothes and accessories, called electronic article surveillance (EAS) tags. Now they’re being made as small, and nearly as thin, as a toothpick. DVD manufacturers stick disposable versions on product packages before shipping to retailers. J. Crew Group Inc. (JCG ) sews the devices right into clothing labels, telling shoppers to remove deactivated units before washing.

Soon stores may replace EAS tags altogether with RFID tags that offer a more precise and inconspicuous way of tracking items on a sales floor. The tags, which come in different shapes, many smaller than postage stamps, communicate with a handheld device, telling workers the exact location of a given item. Retail giants like Wal-Mart (WMT ) and Target are big advocates of RFID technology, but for now use them mostly to monitor inventory.

Cost is one reason retailers are holding back: Tags run from 7 cents to 20 cents apiece, based on quantity; many are waiting for a 5 cents tag before investing in the technology. “The tags would have to be a lot cheaper… to put them on a bottle of water or pack of gum and add value rather than cost,” explains Simon Langford, Wal-Mart’s manager of RFID strategy.

No part of a store churns out more data than cash registers. This is also where employee theft is most likely to pop up. New types of transaction-monitoring software pull information from registers into a central database and look for unusual patterns. An excess of manually entered credit-card numbers could be a sign that employees are stealing customers’ information. Returns of the same type of sweater 10 times in a row at one register, for instance, could indicate that an employee is processing fake returns for a friend or being conned into making fraudulent returns. Retailers decide what to track and how often, and set parameters for alerts. Often the feedback points to problems other than dishonesty. 

The newest retail data-mining programs also sync up with video to permit a more comprehensive look at activity at cash registers. With the press of a button, managers can highlight irregular register transactions on their computers and pull up corresponding video. This could enable them to catch cashiers who cut deals for their friends or pocket cash refunds themselves. It could also curtail fraudulent returns by tracking the route customers take to the customer service desk — do they head straight there or meander through the store, picking up their “return” merchandise along the way?

Despite this revolution in retail tech, you won’t find many stores bragging about their new security tools. No one wants to tip off shoplifters or advertise.

Retailers contend that such measures are justified because the cost of theft gets passed on to honest shoppers. Many also point out that these programs do double duty by collecting data on store traffic and out-of-stock items that can be used to fine-tune inventory and staffing. The bottom line is, loss prevention technology improves the customer experience.

If every retail chain is not yet sold on the benefits of relying so much on chips and software to patrol store aisles, experts still believe the industry will keep moving toward ever-smarter, ever-more-networked tracking systems. The number of video cameras installed in stores is expected to grow by 20% over the next year. Already, tech startups are working on even more promising — or intimidating — systems to track customers through the entire shopping process. There’s even talk of stores installing facial recognition programs and license plate readers to catch repeat offenders. You’re not likely to notice much of a difference at your favorite shopping haunts. But make no mistake — they’re noticing you.

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