DATE: NOVEMBER 2014
CATEGORY: CONSUMER BEHAVIOR, MARKETING, TECHNOLOGY,

BECKONING BEACONS


Timothy McAuliffe

A new technology causing a stir as the “savior of the brick-and-mortar retail experience,” beacons should be on the holiday wish list of brands looking to connect at a deeper level with consumers as soon as they walk through the door.

What is Beacon Technology?

Beacons are small, easily attachable and concealable pieces of hardware that use Bluetooth connections to transmit messages directly to smartphones or tablets that enter/trigger within a programmed vicinity. For those concerned about privacy, beacons work on a consensual agreement – users have to turn on Bluetooth, accept location services on the beacon app and opt-in to receive notifications.

estimote-indoor-location

Example: Estimote in action.

All beacons are not to be confused with “iBeacons,” Apple's version. Although it embodies the same function, iBeacon does not have a physical presence like other beacons – it is already built into Apple devices and the iOS7 mobile operating system. This means there are 200 million iOS devices that can serve as senders and receivers of beacon messages (with user permission), and beacon manufacturers have already started to take advantage of this valuable breadth of consumers in order to improve store/consumer relations and communications.

How are Beacons Being Used Now?

Due to smartphone users already utilizing their mobile devices in stores (browsing, talking, texting, etc.), the logical avenue for beacon technology to go down initially is in the retail world; beacons are currently being used by retail establishments to send customers product information, sales and deals straight to their phones once they walk in the door or engage with a specific item/area in the store.

The quickest and easiest way to reach customers is through an already established network of beacons and apps. Several major players have already made huge strides into placing beacons in major retailers and supermarkets throughout the country, and are actively acquiring apps which already enjoy a large penetration. Initial case studies are demonstrating huge lifts in measurable consumer purchase intent, user engagement and brand awareness. Aside from the unique marketing opportunity to pinpoint customers within a few feet with relevant messaging, beacons are surprisingly cost effective. Based on a performance model, advertisers are only charged when a consumer chooses to engage with the brand, which could be through the action of watching a video as they enter the store, getting a message as they pass a product in the aisle, or even by scanning a product for nutritional information.

How Will Beacons Be Used in the Future?

With “engagement” as the ultimate goal of any consumer business, beacons seem like the winning solutions of how to get up close and personal immediately with target audiences on an once unimaginable/unattainable level. Retail is a perfect start for beacon technology, but in the years to come as the tech proves itself effective and more tech companies create their own competing beacon hardware, it will spread into more industries; imagine public transit being able to alert passengers at certain bus or train stations (or even airports) that there is a delay, or cities and towns being able to alert residents and visitors of emergencies nearby. They are also poised to spread from outside the home to inside as part of home automation systems with the ability to control lights, electronics, etc. (contributing to our inevitable “Internet of everything” future). In a world where consumers are increasing looking for faster, more relevant solutions, answers and gratification in their everyday lives, beacon technology is going to give them what they crave … instantly.
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