2016 is going to be the “Year of the Beacon”, or at least the beginnings of mass beacon deployment. Beacons are part of the latest version of the Bluetooth Special Interest Group (BT-SIG) Low Energy (BLE) specification. In simplest terms, beacons are broadcast from a piece of hardware to the nearest portable electronic device—think the cell phone, tablet or computer you’re already carrying—and allow these devices to perform some kind of action. Typical examples are:
- When you get close to a door, it unlocks
- When you get near a product in a store, you receive a coupon
- Walking through a museum you approach a display, and the audio description of that display is sent to your headset
The number of different use cases for Bluetooth beacons can make my head spin. In the real world beacons are a marketers dream. I can send you a coupon or relevant information about a product when it’s relevant, when you are near the product. Of course one person’s dream can be another’s nightmare. As a consumer, I don’t want all those notifications and sales tools pointed at me, except on my terms.
At its core, Bluetooth beacons are not about sending information, but about allowing information to be received. Beacons use a combination of both software and hardware.
On the software side, the user “opts-in” and allows something to be sent to them. More often than not, this opt-in is via an app associated with an affinity—a store you frequent, a loyalty program, etc. These applications can track coupons, purchase history, show you locations of products on shelves and generally make a consumer’s life easier when visiting a specific location.
On the hardware side, at least a two dozen companies market beacons that use BLE radios to detect other BLE devices nearby. The beacons are small, the size of a hockey puck, often battery operated. They can cost $20 or less, with the price expected to continue to drop nearer to $10 over the next few years.
At current costs, beacons are already being deployed en masse in both trials and real world situations. Consider the new Levi’s Stadium in San Jose where Aruba Networks (a Hewlett Packard Enterprise HPE +0.90% company) has deployed 1300 beacons. These beacons have a variety of uses, all based on a user downloading the Levi’s Stadium application to their phone (the affinity program “opt-in”). Once you have the app and are securely connected, the beacons are a great source of indoor navigation: showing you directions to your seat, the nearest restroom (and how long the wait may be) and other proximity-based events.
One of the most interesting uses of beacons is in retail. Let’s take a look at a few interesting examples of retail roll-outs and trials to date…
Lord & Taylor
High-end retailer Lord & Taylor began testing beacons in earnest in 2014 with a location-based coupon app called SnipSnap. The test involved sending “mystery” coupons to users when they were within 500 meters of a store. By swiping their phone screen, consumers could get up to a 25% discount on merchandise. Following that trial, Hudson’s Bay Company (Lord & Taylor’s parent company) began rolling out beacons across select US and Canadian stores for a larger three-month trial. This trial showed interesting results with “click-to-claim” coupons showing a huge increase in usage rates over standard email and snail-mail coupons. Needless to say Hudson’s Bay Company, moved to deploy beacons further and began a deployment across all their US and Canadian stores.
Large drug retail chain Duane Reade (now a part of the Walgreens Boots Alliance ) began the beacon launch process with an update to their smartphone application. Once installed, the application provided communications with the in-store beacon devices. The new applications provided a variety of applications for users including:
- Notification they were approaching a store
- Loyalty program tracking and paperless coupons
- A history of purchases and coupons based upon those purchases
- A floor map and product locator
Nebraska Furniture Mart
Warren Buffet’s Nebraska Furniture Mart is an extreme example, with each store being over a million square feet of retail and warehouse space. The real challenge of this store is that the merchandise can move daily from one location to the next, making it nearly impossible to know where anything is day-to-day. In addition to location, product prices are managed by a complex system and need to be updated daily.
Enter BLE beacons (again provided by Aruba Networks). Nebraska Furniture Mart installed electronic tags that communicate via two-way infrared transceivers in the store ceiling. This equipment not only downloads prices to the items digital tags but keeps track of the physical items as they move through the store. By connecting this system to the customer’s digital application, customers not only can find their location on a map, but get turn-by-turn directions to the items they are interested in—even if they saw it yesterday and it moved today. In addition, they get the most updated pricing information.
Applications for beacons go way beyond retail or location based marketing. I expect many large-scale beacon installations over the next few years, including airports, subways and train stations for departure and delay information, as well as hospitals for navigation and real-time patient information. Given the fact that consumers already carry BLE enabled devices and the added benefits that beacons can provide to both users and providers, I expect to see widespread deployments and applications for beacons in the near future.
Article originally posted on Forbes.
At its core, Bluetooth beacons are not about sending information, but about allowing information to be received.