Are iBeacons the Next Game Changer in Customer Engagement?
iBeacons took both the business and the technical world by storm when the protocol developed by Apple was introduced at the Apple Worldwide Developer Conference in mid-2013. Since then, iBeacons have continued to be the object of interest and the buzzword for technical enthusiasts. It has led a horde of vendors to manufacture iBeacon compatible hardware transmitters called beacons. Let’s have a look at how iBeacons can change the way brands engage their customers.
What are beacons?
Beacons are a class of iBeacon compatible blue low energy (BLE) devices that broadcast their identifier to nearby portable electronic devices. These transmissions can be received by smartphones, tables etc. that are in close proximity of an iBeacon.
The identifier broadcasted by the beacon can be used to determine the device’s physical location and trigger location-based actions on the device like content display, push notification etc. Various hardware can be beacons – third-party Bluetooth LE emitters, iOS devices, etc.
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How do iBeacons function?
iBeacons are based on Bluetooth low energy proximity sensing. By transmitting a universally unique identifier, they can be used to determine the device’s physical location. Leveraging the Bluetooth low energy, a device with iBeacon technology can be used to establish a region around an object. This enables an iOS device to determine when it has entered or left the region, along with proximity to a beacon. Devices with iBeacon technology can be easily powered using coin cell batteries for short term operation, or large batteries externally for an extended period.
iBeacon technology works on 2 key concepts:
Key concept #1 – micro-location of beacon
iBeacon-enabled apps on mobile devices are notified when the device moves in and out of range of iBeacons (ranging) and are able to monitor the distance (region monitoring) as their proximity changes over time. iBeacon provides the following information via Bluetooth low energy:
- UUID of size 16 bytes
- Major of size 2 bytes
- Minor of size 2 bytes
Region monitoring enables an application to request a notification when the device enters or leaves a region defined by an iBeacon. This is done by specifying the UUID of the beacon. In addition to UUID, the major and minor fields further help to determine the region to be monitored. Region monitoring is limited to 20 regions per UUID and can function even in the background or when the phone is locked. Using strategically installed iBeacons, the user’s device can determine its location with an extraordinary degree of precision – an accuracy far higher than that of GPS. Being on BLE, the typical range is in tens of meters making it apt for indoor positioning. However, the physical positioning of the beacon affects the point at which region has been entered or exited.
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Ranging provides information about the list of beacons detected in a given region, along with the estimated distance from the user’s device to each beacon. As opposed to region monitoring, ranging works only in the foreground and returns an array of all iBeacons found along with their properties. An iOS device receiving an iBeacon transmission can approximate the distance from the iBeacon. The distance between the transmitting iBeacon and the receiving device is indicated using 4 proximity states:
- Immediate: Within a few centimeters
- Near: Within a couple of meters approximately 1-3 meters
- Far: Greater than 10 meters away
- Unknown: The proximity of the beacon cannot be determined
The maximum range of an iBeacon depends on location and placement of beacon, obstruction in the environment, and where the mobile device is being stored. Standard beacons have an approximate range of 70 meters while long-range beacons can reach up to 450 meters.
Key concept #2 – iBeacon and mobile app interactions
The iBeacons signals enable interaction with mobile apps, for example triggering some app functionality to perform a specific action on a specific mobile device – at exactly a specific time and in a specific location.
Some of the interesting features of iBeacon technology are:
- Mobile app automatic start: Mobile devices automatically react when they come within the range of
iBeacons. iBeacons are identified in the background by iOS or Android, and the pertinent app is launched when necessary.
- Energy consumption: iBeacons utilize Bluetooth low energy and are very battery friendly.
- Hardware iBeacons deployment: Hardware iBeacons are small and very easy to set-up/deploy and quite low-cost and expected to become almost free when economies of scales are reached.
- From listening to broadcasting: Apart from passively receiving signals from hardware iBeacons, mobile devices can also actively transmit signals and become de facto iBeacons. Many desktop/laptop computers are iBeacon-enabled too.
- Integrations: iBeacons can be integrated with external systems, content management systems etc. to open possibilities for a spectrum of location-based actions.
iBeacons’ application in retail with customer engagement
iBeacon technology has caught the attention of the retailers because of the level of targeting it can achieve which has the potential to change the way companies and brands interact with their customers and enhance their shopping experience. They can be used with a compatible mobile app, as an indoor positioning system in a brick-and-mortar retail store for mobile commerce, offering customers special deals through mobile marketing with mobile payment feature through integration with point-of-sale systems. Here’s how iBeacons can simplify and enhance the retail store experience:
- Contextualized deals: Based on the micro-location concept, iBeacon technology can convey specific, customized deals to shoppers based on the time/day/aisle, their purchase history, their loyalty profile, etc. For example, if a shopper checks an item in store but did not purchase it: the retailer can offer the shopper a discount via email or directly on the mobile device the next time they are near the same aisle or store.
- Monitoring shopper’s behavior: iBeacon technology can monitor shoppers’ behavior like-store visits, walking-paths, etc. For example, iBeacons enable the retailer to know (in real-time) that the shopper has been standing in front of one specific display for more than three minutes; sensing second-by-second a shopper’s (inferred) interest about a specific product, the system can supply additional information such as online reviews, fashion trends, other available styles or colors etc.
- Multi-channel integration (Online/offline integration): The retailer can gather, for instance, if the shopper visited the same store or other stores of the same chain, which shelves/items they checked there, if they visited the retailer’s website to check out the same or different items, and so on. iBeacon technology allows an effective integration of online and offline shopping, for example a customer may shop in a retailer’s store and, while there, picks also up the items purchased the evening before on the retailer’s ecommerce site. That’s what retail experts call ‘multi-channel integration’, the beneficial merging of the online and the offline shopping experience iBeacons make things like abandoned online shopping-cart follow-up a realistic opportunity for brick-and-mortar stores. Furthermore, the integration of online and offline analytics allows evaluation of conversion-rates that can help maximize ecommerce and in-store sales at the same time.
- Shoppers’ purchase behavior: iBeacon technology enables retailers to acquire a wealth of information on in-store shopping behavior in real-time, prior to purchase. Shopping in brick-and-mortar stores allowed retailers to comprehend the shoppers’ behavior only during the payment time – when the loyalty card and all the purchased items are scanned by the cashier. But now iBeacon technology provides tremendous opportunity to understand shopper’s behavior much ahead in the purchase process.
- Shopper engagement: In a DIY-store the iBeacons system can enable the shopper to receive a notification regarding an upcoming workshop session they may be interested in attending with topics of interest automatically deducted considering his purchase history, surveyed hobbies.
By leveraging the iBeacon technology, retailers aim to optimize their profit by targeting the right shopper, in the right place, at the right time and interactively engaging them in new ways – while learning in real-time from their movement patterns and behavior.
TA Digital has adopted and instituted innovation in its Agile DNA and is working on various proof of concepts (POCs) on the applications of iBeacons in the various business scenarios for their clients.
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