Are marketers squandering the beacon opportunity with too many offers?

Aug 19, 2015

Source: Mobile Marketer

Beacons offer a unique opportunity to leverage proximity data for deeper, actionable customer insights, but so far too many marketers are focused on using the technology as another promotional engine, threatening to undermine its potential if consumers get overwhelmed and turn off the notifications.

With the number of beacon deployments having grown in the past year, shoppers are likely to find numerous more opportunities to receive beacon-enabled special offers as they hit the stores looking for gifts during the upcoming holiday season. However, the kind of highly personalized services that beacons can enable are likely to be less evident.

“The biggest danger in use of beacons to date, is in not providing enough value to the shopper and changing the shopping experience,” said Gary Lee, CEO of InReality. “If the only value perceived by shoppers is ‘instant saving’ and discounts, shoppers may grow weary of the experience and turn their attention away from beacon-triggered content.

“Beacons have a huge opportunity to move away from being strictly focused on price and discounting as they have in their first iterations, and toward being more helpful to assist shoppers in their shopping journey,” he said.

Brands embrace beacons

Industry experts agree that marketers have done a good job of recognizing the potential in beacons, with a number of big names testing and rolling out programs, including Target, Kohl’s, Macy’s, Coca-Cola, United Airlines, McDonald’s and Unilever.

While the number of active programs during the upcoming holiday season will be significantly higher compared to a year ago, the technology is still scaling up.

Google’s recent announcement of its own open-source beacon strategy, called Eddystone, could see the devices beginning to show up just about anywhere.

What marketers need to do a better job of focusing on going forward is leveraging the proximity data from beacons. This information can be used for more personalized ads and emails, customized digital experiences in-store, better store layouts and more.

“Knowing that the consumer went into the store and using the beacon data to understand what transpired while in the store, what purchases were considered, and what purchases were made, if available, can be used to re-target and communicate more effectively to build loyalty,” said Lara Mehanna, general manager of U.S. and vice president of sales and business development at Sonata Local. “This could integrate back to an ad campaign, and email campaign, or a subsequent push notification when reentering the store with an offer to repeat purchase of the product or purchase a like product.

“The retargeting side of beacons is really a valuable proposition for brands,” she said. “Understanding the specifics of location gives marketers much more context and additional information on intent and interests to use to drive sales and repeat purchase.”

One reason why beacon strategies may be focused on offers so far is that retailers are concerned about letting the brands whose products are available in their stores tap into the data.

“The win-win is for them all to work together,” Ms. Mehanna said. “Brands can assist retailers by driving additional foot traffic and retailers can share the data so that brands have more leverage to influence repeat purchases.”

Creative beacon uses

Coca-Cola offers an example how beacons can be used for retargeting. The brand leveraged beacon technology in movie theaters in Norway to collect data on moviegoers so the brand could then retarget them a week later with an offer for a free ticket to return the movie theater, with 60 percent clicking on this ad and 20 percent redeeming the offer (see story).

InReality’s Mr. Lee has a number of suggestions for creative uses for beacons, such as flagging shoppers when items on their wish list are back in stock, helping shoppers decide on items based on criteria entered in their shopping lists, helping with purchasing accessories or other related items and to offer reviews from shoppers as items are being considered in-store.

“Perhaps the greatest growth area for beacons is in highly-personalized services,” Mr. Lee said. “By definition, when a beacon interaction occurs, the client application is running on a personal mobile device, and therein lies an opportunity to offer an experience highly-tailored for that shopper.

“Retargeting is one example of this, but what about also offering a beacon-triggered experience based on past purchase behaviors, loyalty-card points and other data points available on the mobile device which can be used to display personalized content based on who the shopper is and what they are trying to accomplish - all triggered by a beacon signal,” he said.

App engagement

Jeff Malmad, managing director and head of mobile at Mindshare North America points to a bank in Britain that leverages beacons to help people with disabilities who walk into the branch as a good example of how beacons can be used to provide value beyond discount offers. The bank’s app is customized to the services that these customers may require and bank employees are notified as the beacons are tripped so that consumers get personalized service.

“Brands need to leverage the data from beacons in an adaptive, positive way to drive the best opt-in experience possible,” Mr. Malmad said. “When consumers walk into a physical environment, whether it’s a store, a concert, a sporting event, etc. the opportunity to provide more information and value should be the priority for brands - remarketing is a tactic you can build on later.

“For consumers, unlocking new experiences, be it at an event or a store, can be very impactful,” he said.

By offering beacon-driven customized app experiences, this can help marketers ensure ongoing engagement with their apps.

“When consumers open that app, it should be a customized offer for them or something that relates to their interests, not a generic one-size-fits-all message,” Mr. Malmad said. “Once you make the consumer experience very generic on such a personal device, you risk driving the level of interaction down - and then why would they open it again?

“Give people an experience that’s customized and valuable, based on where they have been in your store and what they engage with,” he said.

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