Why Beacon Technology

With the rapid rise of e-commerce shopping, the typical brick-and-mortar shops are at risk of no longer being a customer’s go-to shopping preference.

However, according to Forbes, 64% of retailers indicate that although customers like to browse the Internet to research products, most customers actually prefer to purchase products in-store.

Marketers must learn to implement the newest and most cost-efficient technologies into their marketing campaigns. Using location-based marketing effectively drives sales at physical retail locations to regain their status as the primary shopping preference.

Beacon technology is the leading location-based targeting tool in the retail industry. With over 75% of U.S. retailers implementing beacon technology, these cost-effective devices play an essential role in retail marketing.

All About Beacons

Beacons are small devices, no more than two square inches in size, that communicate with customers in a particular area of a store.

If a customer has a specific mobile application installed and has bluetooth turned on, beacons are able to send signals that trigger servers to deliver instant notifications, reminders, coupons, reviews, etc. straight to their device.

Beacon technology is often compared to geo-fencing or geo-targeting because of their ability to use geo-location services to reach individuals at their fingertips. However, all of these location-based technologies operate differently.

While most location targeting technologies aim to reach their target audience to form lasting connections, beacons are more instantaneous and optimized for in-store interactions.

Reap the Benefits

1. Driving in-store purchases

With more relevant offers and coupons sent to consumers’ mobile apps, people are much more likely to make a purchase as they are passing through your store.

Let’s say Richard was shopping for a new suit at a retail store. As he reaches for his phone to check the time, he notices a push notification with a coupon for a three-piece black suit.

Since a beacon was placed in the suit section of the store, Richard was targeted at the same time that he spotted the clothing. Being able to identify Richard in the beacon’s range allows for personalized offers and notifications to drive sales.

2. Return visits

Beacon technology is not only able to drive in-store customers to make a purchase, but it can also send departure notifications, heavily influencing shoppers to return.

In Richard’s case, after he purchased his three-piece black suit, he received an email containing a coupon to use during his next visit.

Richard is more likely to return to the store because of his positive and personalized experience with the brand’s use of beacon technology.

3. Point-of-sale attribution

Marketers no longer have to guess their customer’s point of sale. They’re able to analyze the data instantly as the beacons send relevant content. Once Richard interacts with the beacon and applies his coupon to make a purchase, marketers can directly analyze that information to know whether or not the beacon was successful in driving the sale.

Ongoing Challenges

1. Bluetooth-enabled devices only

Customers can only receive triggered notifications with their smartphone bluetooth services turned on. While the Bluetooth ‘on’ rates have increased by over 20% since 2015, many people still keep their bluetooth disabled when it’s not being used for a particular reason. This can be challenging for beacons to work efficiently.

2. Active App Users

While you can deliver ads to consumers’ smartphones through display ads, email and social media, in-app push notifications are limited to those who have your specific app downloaded on their devices.

Therefore, beacon technology is best utilized when marketers can identify consumers who are already active users of their retail app.

3. Impressive or creepy?

With the ability to identify a customer’s exact location in a store, beacons are very impressive to marketers but can also be seen as creepy by customers.

Receiving extremely relevant push-notifications can cause customers to consider these marketing tools as invasive rather than resourceful. Therefore, it’s necessary to properly utilize beacon technology to personalize and improve the buyer’s journey.

Invest in Beacon Technology

As one of the least expensive micro-location technologies available, beacons are an essential tool for retailers. Not only do they assist in driving in-store purchases and return visits, but they also provide measurable data for your success.

While some of the challenges are ongoing, beacon technology is still a growing retail marketing strategy that can truly benefit your customers’ retail experiences.

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Let’s connect and discover how you can best maximize your marketing success.

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