Proximity Marketing Promises New Harvest of In-Store Data And Targeting

The "Minority Report" world of hyper-personalized messaging in the physical world could be closer than we think. Every cell phone entering a retail venue is not only a consumer research tool and an ad platform. It is also a personal repository of data, a kind of portable cookie, that consumers could bring into physical stores to signal their preferences and trigger custom signage.

In fact, whether Canadians know it or not, the Toronto-based digital signage company iSign is already counting the numbers of people passing within Bluetooth distance of 1,300 Mac and Couche-Tard stores to understand what addressable audience they may have. “We’re identifying 900,000 phones a day in and around those stores,” says Alex Romanov, CEO. “Once we start formal broadcasting and interactions, we expect it to climb to one-and-a-half million because more people will become aware of it.”

iSign has already installed its short-range antennas in these convenience store locations as part of a North American push to enable proximity messaging to customers via the Bluetooth channel of their cell phones. The initial effort at push marketing will be simple, Romanov explains. “When you get within 300 feet of a [iSign] device, it will ping your phone,” he says. This simple message is itself is both an ad platform and data gathering tool. “You look at the screen and we ask if you would like an offer from X, and you can respond yes or no. To advertisers that is seen as two impressions.” Even if you reject the offer, the advertiser gets branding impressions. “And if you say yes or no, that is data logged, so we know which phone said yes or no to an offer.” While anonymized, every Bluetooth phone has a 13-digit identifier that iSign can see as unique.

Bluetooth is a much-ignored channel in mobile media. It is completely peer-to-peer, and so it works apart from the cellular network, data or messaging costs. The phone can talk directly to a piece of digital signage and can download images, videos, coupons or apps to the phone  And every interaction is delivering back to the retailer data about user interactions with offers.

Romanov says that iSign has already done advanced tests in Singapore in nine major retail outlets. He says that consumers responded eagerly, with a 23% response, amounting to 500,000 to 550,000 people a month. The retail chain had 150 antennae placed throughout the store to broadcast offers in specific sections and to various ranges. The Sony section might have their antenna set for a 30- to 50-foot range so that shoppers passing by a digital sign will get a very specific prompt related to that brand. Another section would have a very different offer.

Romanov says that on the back end marketers can manage the messaging in near-real time to see how people are responding, and optimize accordingly. If users engage with interactive screens and kiosks, then the company can capture even more data about how people are interacting with specific features. “It gives you tremendous profiles based on time of day and place and product category,” he says. “You control the calls to action and can direct consumers to move into areas to take actions.”

But what about the “creepy factor” of having unsolicited messages from the nearby retailer pop up on one’s phone? Romanov dismisses the concern. In most cases people are being prompted by signage to enable their Bluetooth capabilities to receive messages that are directly relevant to the experience at hand: being in-store. The Singapore experience suggests that users will interact with compelling and relevant messaging. “People become very used to it and find it a convenient call to action that saves them some money,” says Romanov. He likens it to the shopkeep of a century ago standing outside of his store conversing with passersby -- or any overt signage at storefronts.

Well, maybe. For some of us this push to our most personal of device might feel a bit more like the annoying fragrance or toy helicopter salespeople now occupying the hallway kiosks at shopping malls. But ultimately the interactions between personal device and digital signage promise (or threaten) the "Minority Report" effect. In its promotional literature, iSign envisions the ability to personalize a digital sign according to the preferences and behavioral patterns of the immediate viewer. “When a participating customer walks into a store, the system recognizes them (through their mobile device), and can tailor the digital advertisements they see based on their shopping history and buying habits, and based on where they are in the store.”

The idea that the mobile device can become a kind of portable profile interacting with the physical world is as unsettling as it is also potentially empowering. After all, how many of us relish the overeager salesperson filled with questions about our needs and wants? There are times when the retail experience feels more like an interrogation or a job interview.

A new GfK report on consumers using mobile devices at retail shows that people feel genuinely empowered and in greater control of the purchase path when they use personal smartphones and tablets for shopping. Marketers should seize on this aspect of mobility to enhance the consumer's sense of empowerment. Leverage the device to help shoppers circumvent the parts of the experience they loathe, like salespeople who ask too many questions and themselves seem instantly stumped by your simplest request.

When it comes to behavioral tracking and targeting, there is a thin line between helping and haunting. With great personalized marketing power like proximity push messaging comes great responsibility to resist the impulse to shove. These tools give retailers the chance to step back from their initial panic about smartphones in the aisles and to think harder about how to use devices to enhance shopping experiences -- not just make pestering more personal. As it evolves, proximity marketing could give you the chance to show you can be a concierge, not a creep.  

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2 comments about "Proximity Marketing Promises New Harvest of In-Store Data And Targeting ".
  1. Nate Carter from Neustar , May 4, 2012 at 2:28 p.m.
    Somehow the idea of an unsolicited message popping up on my phone reminds me of the days of spyware and popup banners. Still simply tracking the number of bluetooth enabled devices walking through a door is innocuous enough to be valuable without being creepy. As the author says, it is how much further they choose to try and push this bar.
  2. Andrew Koven from Geoff & Drew's , May 4, 2012 at 6:59 p.m.
    As always - another great read from Steve!!! I am intrigued by both how far and how fast this could (or will or will not) become a part of our "new normal" everyday mobile lives. Anyone care to place a bet? AK