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Blueprint for setting up a super-targeted holiday beacon campaign

beacon

An in-store offer from a beacon

Macy’s and Frank & Oak are two brands leveraging new types of Bluetooth technology this holiday season to bolster loyalty and in-store engagement. Although there are a few best-practice tips, marketers have plenty of room to experiment with the new technology this year.

The introduction of new Bluetooth products from Apple, PayPal and others over the past few months has fueled a new interest in the technology for retailers this year with in-store transmitters called beacons. Savvy marketers are testing beacons this year to supercharge in-store and mobile efforts for 2014.

“Although I am sure the natural tendency is offer-based, the last thing retailers need is another coupon-delivery engine,” said Maya Mikhailov, cofounder/executive vice president at GPShopper, New York.

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“This is the real power of beacon integration into a mobile application – it can be used for content, personalization and tailored messaging,” she said.

Driving mobile loyalty
As more marketers aggressively combat showrooming, several retailers are rolling out beacon technology this holiday season to build loyalty or enhance the in-store experience.

For instance, Macy’s is working with shopkick on a pilot program that leverages Apple’s new iBeacon feature.

When consumers enter two stores in New York and San Francisco with the shopkick app open, they can opt-in to receive special notifications on deals (see story).

On the other hand, online retailer Frank & Oak is rolling out iBeacon in a pop-up store to add a digital component to in-store shopping (see story).


Macy's in the shopkick app

Bluetooth is not new to retailers, but the difference with the recent in-store offerings is the fact that it is low-energy, meaning that the technology does not drain mobile device’s battery lives as quickly as in the past and could therefore be more appealing for both marketers and consumers.

Additionally, the technology can be highly targeted towards a specific area or aisle of a store.

Bluetooth Low Energy is supported by both Android devices and Apple smartphones and tablets that run on the iOS 7 operating system.

Deploying the technology requires that retailers have a mobile application so that push notifications can be blasted out to shoppers.

Additionally, marketers need to place stand-alone devices in stores or leverage a mobile device to transmit out Bluetooth signals.

According to Ms. Mikhailov, one of the first thing that retailers need to do with beacons is figure out the exact locations in-store where they want to the technology to work.

Two of the easiest ways for retailers to get started with beacons is by placing them at either a store entrance or at the point-of-sale.

A beacon near an entrance or exit lures in foot traffic or keeps consumers in stores for longer periods of time. A display at the point-of-sale could potentially be used to upsell products to consumers.

Depending on the type of beacon, the technology is either plugged into an outlet or used as a battery-operated display.

Retailers looking to get savvier with beacon technology should consider using the battery-operated displays in lieu of traditional in-store signage. These beacons can then serve shoppers exclusive videos or contest content.

Even though coupons and offers are a big draw for retailers when using beacons and Bluetooth Low Energy, there is an equally important value in loyalty-building app initiatives that educate consumers on how to use their mobile devices to shop, per Ms. Mikhailov.

PayPal for example, recently rolled out a product called PayPal Beacon that lets consumers who have downloaded the company’s app checkout in stores without touching their phone. The technology leverages Low Energy Bluetooth to detect when a shopper that has opted-in to the program is in a store and is at the point-of-sale (see story).

In addition to pushing out messages, beacons can be used by retail employees to collect data on how consumers are shopping in-store.

Beacons show a heat map of where consumers are engaging with content in-store, which can influence merchandising and in-store campaigns.


Apple's iOS 7

Scaling in-store efforts
Kenneth Cole, Timberland and Alex and Ani are a handful of retailers that began testing Bluetooth offers earlier this year with a mobile platform called Swirl (see story).

The pilot program at these retailers is now being rolled out at a national level.

The key in using this technology to trigger in-store sales is offering exclusive, in-store deals.

Additionally, testing which kinds of offers consumers are responsive to is crucial for retailers.


The Swirl app

Although retailers may be tempted to roll out beacons and Bluetooth Low Energy into multiple areas of a store, marketers should limit the amount of in-store technology so that shoppers do not feel bombarded by messages.

This means taking into consideration the store size, layout and diversity of merchandise categories to determine how much Bluetooth technology to use in-store.

The beacons should be placed in areas where consumers are spending substantial amounts of time.

For example, smaller specialty stores should limit the number of beacons that are placed in-store while bigger box retailers can use multiple beacons in-store.

“More hotspots is not necessarily better for the retailer or for the shopper,” said Rob Murphy, vice president of marketing at Swirl, Boston.

“One of the key factors that retailers will need to carefully consider is the set of business rules governing messaging frequency,” he said. “Overmessaging to shoppers is a very real risk for retailers.”

Final Take
Lauren Johnson is associate reporter on Mobile Marketer, New York

Lauren Johnson is associate reporter on Mobile Marketer. Reach her at lauren@mobilemarketer.com.

 
Related content: Strategy, mobile, mobile marketing, beacon, Maya Mikhailov, GPShopper, Rob Murphy, Swirl

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