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Are Beacons Lighting the Way or Just a Flash in the Pan?

Last week, Target announced it’s testing out Beacon technology at 50 stores nationwide. So, what are beacons and why do they matter? Beacons are small, battery-powered transmitters that broadcast a unique ID via a Bluetooth low-energy antenna. Apps on phones and other portable electronic devices can read what’s broadcasted and deliver information to you based on your location. For marketers, this means it might be getting easier to deliver the right message at the right place at the right time to potential customers.

Adoption Across Industries
Many airports are using Beacon technology to help inform travellers about boarding gates and flight times, and 44 percent of airports will have Beacon technology within the next three years. Beacons are also expected to play a larger role in educational institutions, enabling schools to deliver deals and information to students and community members, and helping them enhance services at event venues. Banks are leveraging beacon technology and other location-based marketing efforts like mobile imaging technology to help drive more traffic to branches, send special deals to customers and help streamline bank visits for consumers with disabilities. Retailers are increasingly looking to integrate beacons into their existing programs to offer more customized offers and personalized messages, including directions to the nearest brick-and-mortar stores and prompts to visit mobile apps. Beacons also have the potential to help brick-and-mortar stores by better enabling them to offer in-store rewards through loyalty programs.

If you need proof beacon technology is growing, Apple has a licensing program for its iBeacon devices and Google recently launched Eddystone, a new open format for Bluetooth low-energy beacons. TechRadar has a great article comparing both companies’ technologies and development platforms.

Obstacles Preventing More Widespread Use
I have several ideas on why Beacons haven’t taken off as much as they could:

  • Opting In – For consumers, what’s the compelling reason to download a beacon-empowered app in the first place?
  • Turning It On – Many people turn off the Bluetooth on their phones to save battery life. Since most beacons communicate via Bluetooth, that’s a huge problem. Companies can ask people to turn their phone’s Bluetooth on when they download the app for the first time, but then what?
  • Setup Costs – For businesses, it might be reasonable for a larger, global retailer to invest and set up the required technology, including an app, but what about small businesses?
  • Privacy Concerns – Consumers’ and policymakers’ understanding of how location is being used by companies remains low. While many are willing to offer personal data in exchange for contextually relevant deals or information, many aren’t aware of how their information is being (and could be) used.

User Experience
Because it’s so personal, companies need to be very careful how they leverage the technology. Marketers who use beacons to help spam people’s phones with intrusive messages could ruin it for others who want to engage and send more timely, relevant messages.

Have you or would you opt in to receive messages from marketers using Beacon technology? Let us know on Facebook and Twitter.

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