The idea of Bluetooth beacon technology is fairly simple and Apple is emerging as the ”top dog” as the beacon-wars are heating up. PayPal (PayPal Beacon: https://www.paypal.com/webapps/mpp/beacon ) and Qualcomm (Gimbal: http://www.gimbal.com/) are gearing up to challenge Apple with beacon hardware of their own. And retailers like Target (Cart Wheel) and smaller vendors like Estimote, Swirl, and GPShopper are entering the mix with beacon management and consulting on top of hardware or software platforms. A beacon is a small device (for instance Apple’s ibeacon is almost as large as an iPhone 4 http://en.wikipedia.org/wiki/IBeacon and PayPal’s beacon device is even smaller – about the size of a thumb https://www.paypal.com/webapps/mpp/beacon) installed on a wall, countertop or ceiling of a retail store. There could be one or many of them installed. The beacons send out information to all the Bluetooth receivers around them, typically to smartphones of passersby with the required app installed . The short, little beacon messages that your phone gets, tells your phone to go to the web and download content that’s related to where you are or what you’re doing. In the best case, this information will be very focused on the immediate area where you’re standing, or it could be extended to relate to the entire store.

Use of beacons:

Store proximity

Beacons reach out to consumers’ devices e.g. on the sidewalk, to invite the customer to come into the store based on its products, special offers, the store’s customer base, or consumer’s buying behavior.

Check-In

A beacon just inside the door can trigger a reward for the person entering the store, tailored to the customer’s buying history, such as whether he or she is a new or returning customer. And the beacon could also set up a preapproved digital payment method for whatever the customer may want to buy.

Product information

As the customer wanders around the store, the goods advertize themselves and offer additional information about themselves on the customer’s device simply by proximity to the particular product. That information can be powerfully tailored to the customer.

Check out

Ideally, and thanks to the beacon, the customer doesn’t have to join the waiting queue at the checkout. And or no more looking for a cashier or even an employee with a phone or tablet to check out. The customer is free to leave the store with the product. Remember, the customer agreed or already set up his or her preferred payment back on the beacon as he or she entered the store..

Consumer adoption of mobile is growing at an exponential rate

Based on various research studies, it’s very clear that the use of mobile devices set the stage for the beacon. Rapidly growing numbers of consumers are using a store locator service on their mobile device. And, as many of us know from personal experience, consumers often use their mobile device to check prices and additional product information or use comparison tools in stores. I am not sure whether you do it, but my wife and I keep our coupons, discount codes, and our shopping list in the cloud and we use our personal device as an interactive shopping list. Finally I’d  like to point out that the number of consumers who use mobile payment on their phone in some form or another is rising from year to year. For an informative report on US consumer’s mobile shopping habits, I highly recommend Nielsen’s article Shopping Lists: How Mobile Helps Consumers Tick All The Boxes.

Conclusion

From my perspective it would be the worst case if consumers would need an app for each store – ideally the technology would be built into the OS of the device or be part of an overlapping eCommerce platform such as Hybris and cloud technology such as SAP HANA.

 

Post Scriptum

In this context these articles might be interesting for one or two:  

Hybris & SAP – Combining Forces for a better UX in Omni Channel Commerce

Innovative Ideas for Retail – The Smart Fitting Room

 

 

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  • Devika Girish   3 years ago

    Great post. Thanks for sharing. Beacons definitely have huge potential to act as the “missing link” in advertising by providing analysis around the impact that marketing campaigns are having in driving footfall to stores. And with Knorr partnering with Aftonbladet, a major Swedish newspaper to implement a retargeting campaign using beacons, it comes as no surprise that proximity marketing is all set to take hold in 2015. Especially with beacons providing brands with great opportunities to understand their target audience from a branding perspective. However, though beacons are popularly known for sending contextual content, to make the most of these proximity-detection devices, retailers need to get creative at creating engaging campaigns that hold the key to long-lasting customer relationships. For example, they could leverage BLE services to allow customers to reach out to sales asscociates when they need help or to eliminates long checkout lines by allowing for contactless payments. We’ve mentioned six other lesser known reasons why retailers should strongly look into adopting beacon technology in-store here: http://blog.beaconstac.com/internet-retailer-feature-8-lesser-known-uses-of-beacons-for-retailers/

    • Holger Maassen   3 years ago

      Thanks Devika for your comment.

      ‘Yesterday’ we tried to transform brick-and-mortar store experience to the online stores – Today we have to converting the online experience into offline. And the beacon technology is for sure just one of various links in order to combine online and offline – but a very powerful 🙂

      And Devika, thx for mentioning the abbreviation BLE. I think I have to explain it for one or two readers.
      BLE = Bluetooth Low Energy is the underlying communication technology.
      BLE is a wireless personal area network technology by the Bluetooth SIG
      Bluetooth SIG = The Bluetooth Special Interest Group is the body that oversees the development of Bluetooth standards and the licensing of the Bluetooth technologies and trademarks to manufacturers.
      Compared to the ‘Classic Bluetooth’, BLE is intended to provide considerably reduced power consumption and cost while maintaining a similar communication range.

  • Shahid Khan   2 years ago

    Holger, Great article and detail description of beacon use and benefits. Speaking of actual deployment……few questions about the ecosystem in retail and beacon usage:

    1. What needs to happen to connect the beacon-enabled payment to the retail store’s backend system?

    2. Who controls or enables this integration & who pays for it?

    3. How will the product returns be handled? Hooks into existing ERP systems?

    4. Who is responsible for customers payment method security?

    5. Who will update the retail store inventory?

    6. Do the ‘point-of-sale’ vendors connect to existing retail’s inventory/ERP system? If yes, then what is their incentive to do this nuanced and integration cost?

    More later…..