Beacons send specific signals, using low energy bluetooth to handsets. As long as these phones are running apps that can respond to the beacon, the algorithms then sets off a action on the phone – a coupon, reminder, reward or just information.
Beacon technology has been intermittently in the news since Apple launched iBeacon in 2013. It seemed at the time that this method of connecting might be too slow and cumbersome, but today Beacon technology is catching on like wild fire! Reports indicate that beacons would be driving $100 billion in retail sales by 2018, and that is just the beginning! Apple and IBM have teamed up on a host of new apps incorporating analytics and iBeacons. Welcome to the reinvention of retail by digital technology, as the physical and digital worlds converge in retail stores.
There’s been a lot of hype around beacons, so here are some quick guidelines –
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Retail is probably the most often cited example of an industry employing beacons, with heavy hitters like Macy’s and Lord & Taylor deploying them in their stores. But retail represents just one of many kinds of businesses that can benefit from beacons. Starwood Hotels is running a pilot program to replace hotel room keys with beacons. Major League Baseball is using them to reach out to fans in stadiums to offer them seat upgrades. American Airlines is one of a growing number of airlines leveraging beacon technology to improve connections with customers in airports. Meanwhile, in the B2B arena, look for beacons to start turning up everywhere from trade show booths to corporate lobbies.
What: Location-based mobile customer communication
Apple explains iBeacon technology to consumers as the enabling technology for Apple devices to alert apps or websites (which the user has opted into) when someone approaches or leaves a location. In other words, retail or other venues that have beacons in place can detect where a customer is at any given moment. Then — and this is the key part, of course — the retailer or other business can push timely messages to that customer promoting products or providing other useful information. Say someone is walking past a retail store; if they’ve downloaded the retailer’s mobile app, the company can use beacon messages to capture their attention as they go by, enticing them to enter. Once inside, beacons can be used to make personalized offers, speed checkout processes and pretty much anything else the retailer can dream up.
Who: Apple, Google GOOGLE and a growing list of manufacturers
As beacon manufacturer Kontakt has pointed out, Apple isn’t the only game in town when it comes to beacon technology. And in point of fact, Apple doesn’t actually make beacons; rather, it has developed the iBeacon standard around which beacons can be built. (Google has its own beacon standard, Eddystone.) There are a number of players in the beacon manufacturing space — not only Kontakt, but also BlueSense, Gelo, Estimote and others. Check out this list published earlier this year, and expect it to grow as more and more companies look to take advantage of opportunities in this space.
How: Shrinking hardware and Bluetooth Low Energy (BLE)
Beacons began as devices about the circumference of a large apple; today they’re mere stickers that can be placed on walls or objects. The smaller and less obtrusive they get, the easier they become to use. Beacons employ Bluetooth low-energy (BLE) wireless technology to pinpoint the location of customers in stores and other places and to deliver messages to their mobile devices. Specifically, a beacon emits a BLE signal that a retailer’s or other company’s app on a smartphone coming within range of that signal can pick up on. A big differentiator between beacons and RFID is that beacons are far more private because it gives users control of the apps that leverage the beacon. This also generally means that beacons are authenticated and with user permission, which can ultimately lead to tremendous experiences as a result.
Why: The power to revolutionize customer experiences
Writing in the Harvard Business Review, Chuck Martin called beacons “the missing piece in the whole mobile-shopping puzzle.” Pointing to the ability to push messages to people without them having to do anything at all, he sees beacons as overcoming a “major hurdle” for companies that want to engage with customers in a more personalized way — because it makes that engagement completely effortless for the customer.
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Is beacon technology in your company’s future? Increasingly, the odds are that the answer will be yes.
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