Innovative businesses, such as Kenneth Cole, Tesco and Aloft Hotels, are using beacon technology to create more compelling, personalized customer experiences.
During the Connected Consumer Series presentation, titled: A Retailer’s Guide To iBeacon Marketing, Adam Silverman, Principal Analyst at Forrester Research, and Rob Murphy, VP of Marketing at Swirl Networks, discussed the rise of the mobile-empowered consumer, and how beacon marketing can help engage consumers at the store and department level.
Although 16% of webinar participants said they are currently using location-targeted mobile ads, 60% are considering or planning to use this technology. “Retailers and marketers are seeing the value in it but the trick is figuring out how to use it and apply it,” Murphy said. “A lot of retailers over the next few months or year are going to start to add location layers to their marketing capabilities.”
The transition to more real-time, location-based marketing is due to the fact that retail is currently in the “age of the customer,” according to Silverman. “At Forrester, we believe we’re living in the age of the customer, which is a real transformation from where we’ve been in the past few years with the introduction of mobile.”
With mobile devices in hand, consumers have access to a wealth of information, including product prices and locations. Forrester Research confirmed that many consumers are using tablets in their living rooms (67%), bedrooms (60%) and even their kitchens (42%). However, smartphones are used more on the go, including in the car (68%) and of course, in retail stores (68%).
“Empowered buyers demand a new level of customer obsession,” Silverman explained. Beacon technology is a “core part” of the retail transformation.
Overall traffic in brick-and-mortar stores is declining worldwide. Silverman noted that although no indoor malls have been built since 2006, and 15% currently are going out of business, “that doesn’t mean the store is going away; it’s just that the role of the store is changing. The store needs to become more of a place of engagement with a greater focus on conversion. This is where beacon technology can help quite a bit.”
Beacon technology, specifically, can offer context, personalization, insight, efficiency and differentiation.
Swirl customer Kenneth Cole saw a significant lift in app open rates and offer redemption rates using beacon technology. The specialty retailer was able to “provide value and offers at the time of need when customers are in the store,” Silverman noted.
Aloft Hotels is testing beacon technology, which will allow customers to unlock hotel doors after they check in. “You could potentially remove the whole check-in process,” Silverman said. “You could even take more of a concierge approach rather than doing remedial tasks like getting the key to your room.”
Finally, Tesco is piloting beacon technology to improve service and personalization. The retailer is starting out slowly by offering alerts on click-and-collect orders. Then, Tesco plans to add more personalized elements such as enabling consumers to pinpoint the location of products on their shopping lists.
Silverman noted: “Beacon technology is Tesco’s way of introducing these concepts while also boosting mobile app downloads.”
The business-wide benefit of beacon technology is the ability to initiate communication with consumers as they’re making decisions about products, according to Murphy. It presents “a great opportunity for retailers and brands to help educate and influence those consumers with regard to that decision they’re about to make.”
Combatting ‘Zone Bleed’ And Other Beacon Marketing Challenges
Following the live webinar, Silverman and Murphy responded to several questions from attendees.
One topic that emerged from the webinar content was the issue of “zone bleeding,” which is when multiple beacons bleed into each others’ zones, Murphy explained.
“Overlapping beacon signals can be effectively controlled with sophisticated beacon marketing tools,” Murphy noted. These solutions enable retailers to “adjust the broadcast radius of beacon, monitor the signal strength of the beacon and create business rules for controlling content delivery based on dwell time, beacon entry/exit and frequency caps.”
When overlapped, beacons can generate a more accurate location through triangulation, Silverman noted, “and can measure the relative strength of each signal to determine where a shopper is standing, allowing for appropriate content to be deployed.”
Beacon marketing is a hot new trend for retailers, but many executives still are wondering how they can create compelling and relevant messages with the technology.
Murphy noted that there are two key drivers for successful beacon marketing: Relevance and value.
“Every in-store mobile experience that is delivered to a shopper must be relevant to the interests and behaviors of that shopper, and must provide clear value to the consumer,” Murphy explained. “Value can take many forms, including offers, more personalized service, assistance with decision-making, and providing new convenience services.”
A wealth of data can be collected via beacon technology, including customers’ in-store browsing journeys, dwell times, products purchased, offers redeemed, and more. But is it possible for a business to drown in the data being collected?
While the possibility of having too much data is slim, Silverman advised that retailers address three areas:
- Define clear business and use cases, including how success will be measured;
- Hook systems together so data from multiple sources can be combined to determine if the initiative is a success; and
- Align people, process and technology around measuring key performance indicators. This includes creating visualization tools that allow senior leadership to quickly digest the insight and determine if the initiative is meeting its objectives.
Want to learn about more retailers that are using beacon technology? Want to receive detailed insights on how to roll out beacons in your stores? Access the on-demand webinar today.