Reading the iBeacon's Signal: Brick and Mortar Gets A Data Layer

As was the case for music players and smartphones, Apple has accelerated interest in in-store mobile interactivity and micro-targeting at retail. Whatever you think of the iconic company’s purported decline in influence and mystique after its loss of Steve Jobs, Apple still has the power to bring attention to categories and streamline product categories that others may have pioneered but never scaled. When it comes to in-store short-range mobile communications, a number of other companies have been working with Bluetooth and WiFi since 2005 and earlier. But the arrival of the Bluetooth LTE iBeacon device last year and its integration with iOS 7 has already given the platform traction that years of experiments have not. MLB is starting to roll our iBeacons at major ball parks. Shopkick partners like Macy’s and American Eagle are testing the waters. And just last week,  retailer Alex and Ani announced a major deployment of the devices in more than 40 stores.

As a content delivery device in store, the Bluetooth LTE system is being seen as a way to push information and promotion directly related to the products customers are standing near.  This level of interactive targeting is unprecedented and of course irresistible to retailers who have been struggling against the real or imagined threat of mobile-fueled “showrooming.” But for Alex and Ani, which partnered with Swirl Networks to deploy the iBeacons, the problem is less about customers being hijacked by Amazon in-store. The company offers unique items, eco-friendly and American-made, that require some explanation to fully appreciate.

And during peak gift-giving seasons, one of the fastest-growing retailers has a people problem.“Our problem is that our stores are sizable, but in the days before a big event you can’t move in these stores,” says Ryan Bonifacino, the company's vice president of digital strategy. “We have many people to interact with, and it takes a while to tell the story. It is high-touch.” Many of the items are tied to specific charitable organizations, and people tend to buy them because they are associated with causes that resonate.



So job-one for in-store Bluetooth is more efficient education. Alex and Ani went paperless a while ago as part of its ecologically conscious mission, which means receipts go out to customers via  email, so the retailer has all of its customer email addresses. This means it can tie content pushes to mobile phones to ultimate purchases. And since the company partners with a number of Major League Baseball teams like the Boston Red Sox, it could partner with sports arenas and push content to potential customers when they're attending games.

In its initial stages, Alex and Ani was proving  the technology via the Swirl app, which people must invoke in store to enjoy the localized content. Later this year, the company will launch its own branded app that will use the Swirl SDK to integrate iBeacon interactivity within the company’s own branded experience. And Bonifacio anticipates that in the long run one important payoff will be the in-store location data he will be seeing and tying to sales.

Of special interest to Bonifacino is tracking the buying habits of new and existing customers. But also important to the basic flow of customers and the architecture of stores in understanding data points like time spent in store, how to get people in and out of the store more quickly, increasing sales per square foot. “We are seeing where people are positioned in the store and comparing new and existing customers and visual merchandising,” he says.

The data iBeacons provide about customer flow can be mapped against the merchandising goals of the company. Alex and Ani is famous for its charm bracelets, but also sells extensions of its own products, associated items like candles. “We are not a jewelry company,” Bonifacino says. “What we do is stress lifestyle brand product extensions.”

So Bonifacino expects to look at multiple data sets from the iBeacons to understand how juxtaposing different products in the store impacts bundled sales. The sales piece tells him one part of the story, and in-venue interactivity lets him see what parts of the store and what products attract the most customer interest, where content and interactivity is most needed and where they pay off ultimately in sales.

And for a retailer like Alex and Ani, with a growing loyal base of repeat customers, in-store mobile interactivity allows for new levels of personalization. If the in-store experience can be tied more directly to previous purchases, or even gifts the retail loyalist gets from others, then the app can customize the in-store experience in astonishing ways.

Imagine a brick-and-mortar experience that resembles Amazon’s level of personalization. You can walk into a venue and consult your store app, that already knows which items would be of most interest to you based on your own purchase and gifting history.  It's as if the store itself were rearranged physically for every customer. 

1 comment about "Reading the iBeacon's Signal: Brick and Mortar Gets A Data Layer".
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  1. Pete Austin from Fresh Relevance, February 19, 2014 at 5:11 a.m.

    How does this work in practice? The first thing I bought on my last shopping trip was carrots, but in the past I've bought loose carrots, organic carrots, value carrots, baby carrots and chopped carrots. What I choose depends on price and what the quality looks like. Similarly for other product categories. So does the store highlight several hundred products for me in some way? I genuinely can't imagine how this would be useful.

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