I played around with the software a bit. It's going to work like this (but probably not red):
It figures out the direction of travel and lights up the stairs in front of you, even if you change directions. If it detects 2 people are on the stairs then it goes into an "indeterminate" mode (not shown) where it lights up both the stairs above and below all the stepped on stairs.
I'll have to wait for the sensors to be installed to see if I can detect our doggo, hopefully I can do a special lighting mode for her. 
EDIT: if you made it this far, be sure to check out my follow up topic: