Beacon Marketing allows companies to engage with customers, uniquely and excitingly. Beacon technology utilizes a small, battery-powered device called a beacon that is installed in various locations. This device utilizes Bluetooth technology to communicate messages between the customer’s device, such as a cellphone and the beacon device. This technology also allows customers to receive a customized user experience with retailers. Specifically, customers are attracted by personal offers of discounts, suggestions, or more. For example, it may have happened to you before you enter a store looking for a deal, and five minutes later, you receive a notification that you qualify for 30% off your next in-store or online purchase. This is as a result of the highly innovative beacon marketing.
- Beacon technology, through proximity data, allows brands to personalize their marketing and segment their customers. Brands can tailor their suggestions and offer deals specific to each customer based on information provided by the beacon technology to increase their customer engagement. How it does this is by helping marketers gain insights on the customer, such as the average length of time in-store and the product sections frequented by each customer. With that knowledge, marketers can tailor their advertising to that customer and make precise recommendations to increase the likelihood of conversions and purchases.
- Beacon technology also increases the open rate for most companies due to the geo-targeted messages. “Research shows that people open standard push notifications about 14% of the time, but they open messages transmitted by a beacon more than 50% of the time because those messages appear more relevant.”
- Beacon technology is also affordable and relatively easy to install and setup, which makes it low risk and high possible return on investment.
- Beacon marketing can increase the use of a business’ mobile app as well as stimulate in-location sales. Beacon triggered notifications based on proximity allow apps to be more engaging shopping tools and also drives traffic with a promotion to the nearest physical location if, for example, you are in the mall and beacon technology directs you to a specific store.
- There is a thin line between “cool” and “creepy.” Customers are generally not put off by companies having access to their data; however, there has to be a sweet spot or a midway where this personal data is only used to provide value to the customer and not to push all marketing communications. Customers are aware that companies possess their information; however, they do not like to be overwhelmed with just how much the company knows or bombarded with marketing communications.
- Beacon marketing is limited to BLE (Bluetooth) signal; therefore, if a customer does not have Bluetooth enabled, beacon technology will not be able to detect them. This also limits the data the company has as typically the demographic that has Bluetooth enabled only allows the marketers to reach a specific target audience as the Bluetooth may be enabled for Bluetooth pairing of devices, which typically represents a younger demographic.
- For some brands, beacons rely on installed brand apps in order for the beacon technology to communicate with the customer’s device. For example, if I enter a gap store and do not have the gap app-enabled, I may not be able to receive beacon communication with personalized offers.
It is increasingly difficult for marketers to engage with customers in today’s culture. Despite the disadvantages, beacon technology allows marketers to learn about customers and provide critical insights to create new and interactive marketing communications. Beacon marketing encourages engagement and interaction with customers to make shopping experiences more interactive. If used wisely, the data garnered from beacon technology can be extremely beneficial to the company in marketing strategy and marketing decisions.