By 2020 some 400 million beacons are set to be deployed and in 2016 they could influence up to $40 Billion in sales in the US. It would be easy to conclude that beacons are here to stay. This statement may be true within the retail sector, suggesting that beacon technology will change the shopping experience in a way that hasn’t been done before. So, what are beacons, how do they work, and how will beacons be used?
What are beacons?
A beacon is a piece of technology that allows a store to interact with a consumer via their mobile device. Beacons do this using Bluetooth Low Energy (BLE). This is a form of Bluetooth that is designed for one-way data transmission (up to 100m) and is low on energy consumption and therefore inexpensive to use. As a result, BLE doesn’t require the devices to pair in the same way regular Bluetooth does.
How do they work?
There are two main beacons that are in use on the market, the iBeacon (Apple) and the Eddystone (Google). With these two types of beacons, there are some similarities but also some key differences to note.
The iBeacon was developed by Apple and has held the lion’s share of number of beacons deployed since the introduction of the technology in 2013. It is a proximity sensor that interacts with apps on devices that run both iOS and Android. This allows the retailer to interact with a consumer (provided they have the retailer’s app on their mobile device) about the products that they will be looking at in the section of the store they are standing in.
You are in Target and you walk into the technology section, when you do this the beacon recognizes your device and sends you information about the TV’s and Computers you will be looking at. You could browse reviews and see what others think about products.
The Eddystone beacon is Google’s answer to Apple’s iBeacon. To understand Eddystone, however, is a little more complicated because it is actually a collection of 4 distinct protocols: Eddystone – UID, TLM, EID (unreleased) and URL. The first three all work similar to the iBeacon in the sense that they only interact with apps. The URL protocol is where Google really sets themselves apart from the competitors. The URL protocol allows for the beacon to transmit URL’s and allows for the proximity sensor to interact with a consumer whether they have the retail app or not. The URL’s can be read by any compatible “physical web browser”. These include Chrome, Chrome iOS, Opera and the Firefox OS. Bypassing the app is a critical difference with Eddystone, as restricting the beacon to only app users can impact the number of consumers who will have access to useful information at the time of purchase.
You are going into a new technology store for the first time. As you walk through the door you receive a notification from your physical web browser, containing a URL to a web page that welcomes you and tells you about sales that are happening in the store. As you walk around and browse you receive similar notifications for the computers section and the TV sections. These notifications connect you to reviews and product info.
This is the real difference and power of the Eddystone URL protocol and the physical web. The consumers will be opted into it without even knowing, the retailer will be able to interact with each person’s mobile device each and every time they walk into the store.
How will the consumer use beacons?
The consumer may never realize that they are interacting with beacons. They will walk into a store and get a prompt on their mobile device that says “Welcome, we are having an up to 25% off sale on denim”, the hope is that consumers will find this information useful and will enjoy the experience. As the technology develops and advertisers and marketers become more “beacon savvy” the personalization will evolve and become more customized to the individual consumer. This technology will allow marketers to pull analytics about where and when consumers shop and what these consumers buy. Ideally the data will drive increased sales to the both brick and mortar locations and e-commerce stores.
I truly believe that beacon technology is here to stay. As we become more and more mobile and as technology becomes more ingrained in our lives this type of technology will be allowed to flourish. I predict that this will bring an unprecedented revolution to the retail. It will allow brick and mortar stores to offer sales and product information to the consumer on a whole new level. We will learn so much more about how consumers shop and how they interact within the store which will provide new analytics and will in turn allow marketers to provide more customized marketing strategies across all platforms. As this technology evolves, the learnings will translate to new more customizable hyper-local marketing strategies that will be tailored from location to location or person to person.
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