Indoor location services are revolutionizing dozens of industries, from retail to real estate to connected homes. Macy’s, McDonald’s and Major League Baseball are redefining their consumer experience with beacons. The San Diego convention center has embraced beacons, as has the Miami International airport. The footprint of beacon technology is growing fast and becoming too big to ignore.
What are beacons?
A beacon is a small device that transmits a signal to a smart phone letting it know its proximity to the beacon. Beacons transmit via Bluetooth Low Energy (BLE), which lets the communication occur without significantly impacting the battery life of the phone. Unlike GPS, beacon technology works indoors and is sensitive to distances under a meter. An app on the phone interprets the beacon information, and then retrieves content relevant to the user, such as a coupon to a nearby restaurant or step-by-step directions to the nearest restroom. One of the primary challenges facing mobile technology is a user’s concern for privacy. With beacons, the app they engage with must have location and push notification permissions. If users feel overwhelmed with irrelevant information they can easily opt out by changing their permissions or uninstalling the app. Another major privacy assurance is that beacons only transmit. They don’t receive or collect signals from mobile devices. They have no ability to know who you are or track your location.
Who uses beacons?
A large potential base of users is already in place. Starting in 2011, Apple began putting its iBeacon technology that uses BLE in its new iPhone, iPod touch, iPad, and iPad Mini. Other mobile phone manufacturers followed suit in 2012. Tens of millions of compatible devices are already in consumer hands, and ABI Research estimates that 90 percent of Bluetooth enabled phones will support BLE by 2018. Brick-and-mortar retail stores are particularly excited about the technology, and with good reason. Location sensitivity allows physical retail to push deals and coupons to those nearby and heat map visitor concentration to track which displays are generating attention and which are being ignored. Enhanced traffic tracking and the ability to precisely target nearby users will bring to physical stores advantages once held only by online retailers. But beacons are bigger than retail alone. A tremendous number of industries are benefiting from beacon technology. Airports are providing flight information directly to those waiting at the gate. Museums are offering supplemental information about a painting to inquisitive visitors. Convention centers are directing guests to specific exhibitors. Anywhere that targeted, timely information can improve a customer experience, beacons are playing a vital role.
Why now?
Savvy companies are becoming early ambassadors of this emerging technology. As the advantages of timely coupons, step-by-step indoor directions, and precise information are more widely conveyed to customers, demand for beacon technology will grow very rapidly. Facebook very recently announced a pilot program called “Place Tips,” a geo-location feature driven by a combination of beacons, Wi-Fi, cellular data, and GPS. Facebook’s program is positioned to convey the advantages of location sensitivity to a user base of millions. Apple has filed blueprints with the FCC that indicate they are poised to produce beacon hardware. The marketing machine of the world’s most iconic tech company will help drive wide adoption of beacons, and ultimately user acceptance. Once people are accustomed to using the service, it will become part of the fabric of everyday life. The Mobile Marketing Association estimates that mobile marketing will become a $400 billion industry this year, employing almost one million Americans. Beacon technology lets marketers engage a mobile audience in entirely new ways, and thanks to refinements in beacon software, delivering content is as easy as uploading a video to YouTube. An army of mobile marketing professionals are gaining access to a technology that makes it easier than ever to speak to their audience. An industry projected to outpace the GDP of Columbia is poised for a revolution thanks to Beacon technology.
Who will be the winner in beacon technology?
Some companies will carve out their niche by offering specialized beacons; ones that are decorative, or weatherproof. Others will help beacon users refine their messaging, driving world-class experiences that keep users engaged. Complete solutions can be found in companies offering both hardware and software, including a software developer’s kit that makes app management so painless that mom-and-pop stores can easily handle it, and big box stores can delegate beacon management with minimal training. A vast market is being validated. It is enhancing the customer experience across dozens of industries, and reshaping the way people interact with the world through their phones. There is a lot more room for success stories in beacon technology. Whether you’re a savvy investor or a customer-facing organization looking to increase sales, engagement or overall satisfaction, it’s time to get on the bandwagon. Image Credit: Flickr/Jonathan Nalder
