Commentary

2014--The Year Of The iBeacon

In December, Apple announced that it would implement iBeacon technology in all of its retail stores.  So I headed down to my local Apple store to check it out.   What I found didn’t exactly “blow my mind.” Their current implementation doesn’t seem to do a whole lot--yet 

After installing the Apple Store App, ensuring my Bluetooth was set to “On” and giving the app the appropriate permissions, it sent me push notifications with details about nearby products--not all that exciting.  But the potential improvement to the in-store shopping experience is enormous. Despite being a little underwhelmed by Apple’s initial implementation of the technology, I’m betting that iBeacons (and other Bluetooth LE devices) will be a big deal in 2014. 

Getting “the right message, to the right people at the right time” has long been the digital marketer’s elusive “holy grail”.  The critical ingredient, unified behavioral data at the customer level, has proved all but impossible for most retailers to obtain.  iBeacon has the potential to change that.  It will provide retailers with insights into their customers’ in-store shopping behaviors by interacting with the mobile devices that are already in their pockets and on their wrists.  It will also provide a new method to display personalized, context-appropriate messaging to customers while they’re in the store.  And there’s almost no barrier to entry. Smartphones already support iBeacon. 

So what are iBeacons exactly? They’re tiny, low energy indoor GPS-like transmitters. Your phone can pick up their signal indoors with a high degree of accuracy and without draining its battery.  In fact, iBeacons are so “low energy” that a coin battery powered iBeacon can transmit its signal for over a year without needing a new battery.  

And how will iBeacon transform the retail experience? Retail service isn’t what it used to be. Retail sales people often know little to nothing about the merchandise they sell. They certainly don’t know much about you or your style.  With iBeacon, retailers will have the means to offer all their customers a “personal shopper” experience. 

Imagine being greeted by name by a salesperson carrying clothes that fit your style and budget, and are in your size when you enter your favorite department.  

By integrating iBeacon technology into their mobile apps, retailers will know who their customers are, where they are located in the store, where they spend their time, when they last visited the store, what they’ve purchased in the past and what they’re most likely to be interested in purchasing. They can then make timely, personalized recommendations and offers that will convert more “browsers” into “buyers.” 

Retailers will welcome their customers into their favorite department with push messages and interactive displays that offer tips from top designers about how to rock this season’s latest fashions while making the most of the wardrobe they already have.  They’ll provide directions to products their customers may be interested in, within areas of the store they may not yet have visited. 

Your mobile device already supports iBeacon.  The devices are inexpensive and easy to install.  Retailers just have to integrate them with their existing mobile applications, and their existing customers will be iBeacon customers. 

If you’re squeamish about privacy issues, don’t be.  iBeacon is opt-in only.  If you don’t want your store to know about you, then don’t sign up for the service.  

Given the number of consumers carrying iBeacon ready devices, the insights they will provide to retailers, and the potential they have for transforming the retail experience to give shoppers a new reason to visit their local store, 2014 will be the year for the iBeacon.

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3 comments about "2014--The Year Of The iBeacon".
  1. Hilmi Ozguc from Swirl , January 14, 2014 at 12:27 p.m.
    Retailers who are considering leveraging iBeacon technology will need to do more than just integrate it with existing mobile applications. They also need to consider security, scalability, and the shopper experience. In order to prevent unauthorized use of location broadcasts, retailers should employ extra layers of data encryption and security on top of iBeacon's open protocol. To support large-scale rollouts, retailers will need robust tools to manage, troubleshoot and coordinate networks of thousands of beacons. And, in order to gain widespread consumer acceptance, retailers will need to create truly valuable and relevant experiences for in-store shoppers. iBeacon technology is a game changer, but retailers will need to employ a new set of capabilities and strategies to realize its full potential.
  2. Sarper Silaoglu from Boni , January 14, 2014 at 3:27 p.m.
    Hilmi you are right and please give your comments on consumer convenience. Do you think that people are willing to have contextual offers via their phones' notifications? Or should there be a game changing proposal for them to make them enroll micro location based services?
  3. Hilmi Ozguc from Swirl , January 14, 2014 at 5:08 p.m.
    We’ve done some research into consumer response to in-store smartphone alert notifications. Our recent study (http://www.swirl.com/pr-12-13-13.html) found that 77 percent of consumers would be willing to share their smartphone location data as long as they received enough value in return. We also found that sixty-seven percent of shoppers have received shopping-related alerts on their smartphones in the past six months. Of those, 81 percent read/open them most of the time and 79 percent have consequently made a purchase at least once. Consumers are primed to receive these alerts, and they’ll act on them when the content is relevant and valuable.