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While location based marketing is not a new strategy, iBeacon, Apple’s recently introduced Bluetooth LE-based technology that extends location-based services in iOS, offers exciting new opportunities to engage consumers in retail stores and other destinations.
iBeacon uses Bluetooth 4.0 to pick up signals from Bluetooth-enabled phones. With an advanced API software and transmitter hardware that reaches up to 150 feet, the technology allows businesses to precisely estimate a phone-owner’s location, and exchange data and information.
iBeacons are so efficient that even the largest of stores would only need handful of beacons per floor to enable a high degree of positioning accuracy.
Aside from its ability to precisely target consumers based on their location, the price is right too. Estimote, a company that just launched to sell iBeacons, is taking pre-orders at $99 for three beacons.
As a cheaper and more exact alternative to previous location targeting technology, iBeacon promises to be an appealing option for marketers due to its increased effectiveness and low cost.
How marketers can use iBeacon
So how exactly can marketers take advantage of iBeacon technology? Monitoring consumer shopping patterns, spending history, and even real-time location can allow your brand to develop more precise, targeted content to entice shoppers and sell product.
With iBeacon, marketers can track customers as they travel from location to location, developing a granular profile that offers insight into their go-to shopping spots and product needs.
iBeacon’s real-time tracking capabilities also provide opportunities for targeted engagement with consumers. As the device picks up signals from nearby smartphones, stores can send app users personalized offers, coupons, and information about in-store events to lead consumers in store and in pursuit of relevant deals.
Offering promotions using iBeacon is another way to incentivise customers to spend. Retailers, for example, can drive nearby consumers to a store by offering scavenger hunt-like deals and featured product specials that urge consumers to take action based on their proximity to your store.
Even marketers at tradeshows or other events can utilize iBeacon’s location-based tracking system to deliver content to attendees to enhance their experience.
Barriers to entry
Despite the benefits of using iBeacon to target customers based on location, the technology will need to overcome a couple of challenges before reaching the mainstream.
Because Bluetooth capabilities must be enabled and an app must already be downloaded for the technology to be effective, customers have to choose to opt in.
In addition, Bluetooth often suffers from signal absorption from objects like walls, windows, clothes racks, etc. As such, the signal strength has the potential to fluctuate which makes determining a distance from the beacon challenging.
As vendor SDKs mature, these fluctuations are likely to be compensated for in order to provide more accurate readings.
How can businesses combat these potential barriers? By targeting shoppers who have established enough loyalty to your brand to download the app, and reminding frequent customers to participate.
Brands can use in-store signage to encourage downloads and encourage social sharing to get the word out.
Sending push messages in your existing app can also be effective at driving conversions and seeing results. By honing efforts on loyal customers and giving them an extra push, marketers can make the most of the iBeacon strategy and increase reach.
Businesses doing it right
To help bring potential customers inside the store, variety store company Dollar General uses iBeacon to target nearby traffic.
The company’s initial iBeacon campaign, which was implemented in cities with high store concentration, urged shoppers to opt-in by offer special discounts, Dollar General-specific content, and a lookbook that highlighted specialty items available in the store.
By week four of the five week campaign, Dollar General saw some impressive results. Marketers offered the campaign to more than 60,000 devices, and over 7,200 mobile phones downloaded the software.
Dollar General’s incentivized marketing strategy proved successful at driving the iBeacon campaign, situating the store for long-term payoff.
For Major League Baseball, engaging customers already inside stadiums was first priority of the organization’s iBeacon campaign. MLB worked with Apple to install small iBeacon sensors at various locations in and around stadiums across the country.
When an iPhone user running iOS 7 and the MLB At the Ballpark app walks by the device, their iPhone detects the iBeacon and a push notification is displayed on-screen.
On-phone advertisements include opportunities to check-in, video snippets, coupons, and special ticket offers pertaining specifically to MLB. Using iBeacon to target in-venue users allows MLB to increase valuable engagement with game-goers and advertise directly to relevant targets.
Finally, department store chain Bloomingdale’s recently ran an iBeacon campaign in two malls with the goal of raising awareness for its Loyalist rewards program, which enables shoppers to earn points for every dollar they spent.
Bloomingdale’s used iBeacon to target in-store users, who were prompted to participate in the loyalty program directly on their mobile phones.
The campaign ran for four weeks, during which time more than 74,000 devices were asked to download the content.
Of those reached with iBeacon, 7.2% opted in and 75% of downloaders engaged directly with the content, using the loyalty program to track purchases and build discounts on platform.
By using iBeacon inside a mall, retailers such as Bloomingdale’s can more deeply engage relevant audiences directly on their mobile phones, building relationships and fostering brand loyalty.
While its potential to impact the marketing industry is huge, it is important to note that iBeacon is just one piece of a strategy to engage consumers along the path to purchase.
As with any element of a multifaceted marketing strategy, cost, effectiveness, and adoption must pay off to ensure success.