Beacons are not complicated devices. They can send a limited number of parameters such as a user ID and the distance from your mobile device.
The added value comes from the fact that we can determine the exact position of a customer and send dedicated messages in a real-time.
46% of retailers have launched beacon programs in 2015, up from 15% in 2014.
Recently, beacons have become a part of many discussions about new technologies. We hear a lot about the applications of these little transmitters in various industries. They help to sell, they navigate where GPS loses its capabilities, they support the tourism industry, hotel industry and others. Because they send a signal to a Bluetooth mobile devicesthat almost everyone has, they can be used as a kind of trigger that sends targeted, contextual messages.
Beacons are a new and, for many, unfamiliar technology. There are often questions about the security of data and surveillance. Most consumers don’t know much about how beacons actually work and what they really do.
Entrepreneurs or investors should also consider the issue of data collection and storage. Is it worth investing in new, untested solutions? Are potential clients sufficiently educated to use this kind of technology and will they be comfortable with it?
Here are some answers to common questions about beacons.
1. How is data secured in a beacon infrastructure?
Firstly, you should know that beacons themselves do not collect or store data. Beacons are not “intelligent” machines, so they can neither store nor send our data. Beacons only send out a signal that is detected by smart devices in its range that have an app installed.
The application then sends a signal to the management system of the advertising campaign: “user ID number entered into the shop X”. Nothing more. Beacon communications use encrypted ID numbers, and data is not exposed. The system uses the relevant databases, decodes the information sent by the beacon, later identifies the specific client and adapts to their profile message, for example: “Good morning, Ann, use today’s 20% discount on any item”.
We must remember that in order to receive such information, while installing the application, we need to agree to receive commercial messages. In doing so, users make information about themselves available.
2. Do beacons “track” people? Are app users under surveillance?
Information about your clients’ buying behavior is accessible only by the owner of the brand, the company to which their client made the data available. We should be aware that at a time when almost everyone has a smartphone, we are constantly broadcasting our location. Much more threatening to our privacy are things like video surveillance systems in commercial buildings or settlements.
3. Will beacons spam users with notifications?
No. Messages from companies or institutions can only reach clients who have installed a particular app on their smartphones and agreed to receive commerical messages and have Bluetooth enabled. This constitutes consent for a brand to communicate with customers. No brand wants to put off customers by sending too many messages in a given time period.
4. Is the public ready for beacon solutions and does the technology allow for real, measurable benefits?
These days, consumer are sophisticated shoppers. They are familiar with using technology to help them find the best prices and product choices. Anything that makes shopping more convenient is easily adopted. Of course consumer education from businesses, institutions and innovative companies is essential. Accepting beacons as part of the retail landscape is also supported by the development of technology. Soon BLE (Bluetooth Low Energy) will be enabled by default in new smartphones due to its low energy consumption. The number of devices with systems that support BLE will also increase. The goal is to establish a relationship with customers that allows for the regular use of the application.
5. Is it too early to think about the implementation of beacons in your company?
Marketing based on beacons to many entrepreneurs seems to be a question mark for the future. But the sooner you become familiar with the technology, the better. We’re not past the early adopter stage and beacons are going mainstream. In addition, the number of messages sent through beacons (push messages) is still relatively small and still growing. Beacons should be on the list of any business looking to enhance communication channels with consumers. Given the well-known fact that acquiring new customers is much more expensive than retaining existing ones, beacons are the ideal solution for anyone who understands that customer service is the new marketing.
6. How likely is it that existing and new customers will install the application?
Let’s see what the data says. According to research by Sarah Johnson (Credit Donkey) in March 2015: 52% of Americans have confirmed that for a voucher of $1 they are willing to give you their email address, 26% could give an address, 54% – date of birth, 71% – postal code. So you do not need much to encourage clients to download the application to engage with beacons. Ensuring the application stays installed and active is a different matter and depends on the quality of the content you deliver.
To sum up, the use of beacons is sure to increase going forward and consumers will become more familiar and confortable with them. Deloitte Research shows that by the end of 2015, one-third of stores in the US and about 20% in the UK will implement solutions that will use beacons. In the end, a similar trend will occur in Poland as well. It is worth being engaged with beacons now, while the market is still new, in order to later be able to benefit from experience while others are just starting out.