Beacon marketing - everything you need to know

Though Bluetooth beacons are extremely cost-effective for the returns they offer in terms of indoor positioning and indoor navigation functionality, it’s perfectly natural for businesses that have invested in beacon technology to want to squeeze every bit of value from them.

Though a large proportion of businesses will use beacon-powered infrastructure for the aforementioned solutions such as indoor positioning, many are subsequently finding that the presence of beacons in their retail locations is enabling them to launch exciting new marketing campaigns and initiatives as well.

In this guide, we’ll delve into what beacon marketing is, how it works, and some examples of popular campaigns or marketing uses.

What is beacon marketing?

Beacon marketing refers to the ability to target mobile app users when they're in specific areas or zones of physical locations such as retail stores. The user's position is generally determined by their proximity to a number of small beacons. The targeting of the user normally takes the form of an in-app message or mobile push notification - for example, alerting users in a retail environment that they're near a product that has recently been discounted. 

Is beacon marketing the same as proximity marketing?

Generally speaking, yes - beacon marketing is the same thing as proximity marketing. Technically, beacon marketing is a subcategory of proximity marketing - while all beacon marketing falls under the umbrella of proximity marketing, it’s not the only method of proximity marketing. More and more, infrastructure is changing to reflect the greater demand for Bluetooth positioning in general, so as well as beacons, there are now things such as Bluetooth-enabled lighting and WiFi access points, which would also fit the bill for proximity marketing.

How does beacon marketing work?

The key to beacon marketing is, as the name suggests, the beacons themselves. These Bluetooth-enabled devices are used to repeatedly ‘ping’ a device (typically a smartphone) and, using triangulation and a variety of other technological methods, can detect a user’s position within an indoor location. Systems such as Pointr’s Deep Location® are considerably more advanced than just basic triangulation, and can pinpoint a position (as well as granular detail such as which way a user is facing) with far greater accuracy. 

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Once the device or app has ascertained the user’s position, it can correspond with the app and, based on location, trigger a number of different marketing messages. The precise location that triggers the marketing message can vary. In some cases, it might be a particular location in a retail store. In others, it might be a wider area, meaning that any customer within a certain ‘zone’ will receive the message (commonly referred to as ‘proximity beacon marketing’ or ‘geofencing’).

The most common uses for such geofenced push notifications are for a visitor entering or exiting a store (sending either a 'welcome' or 'thank you for visiting' message), or alerting the user to a nearby special offer when they're within close proximity to it. The notifications can even be based upon a more specific movement - for example, a message could be set to triggered only if a user moves from one designated location to another. This is useful if a user has been browsing in one section of a store (such as push bikes) and then moves to another section that houses complementary products (such as safety items like cycling helmets).

In order to work, beacon marketing therefore requires:

• Beacon (or equivalent technology) infrastructure
• An app which corresponds with the beacons, and which has the requisite user permissions to track positions and ping devices with notifications and messages
• An accurate map of the indoor location in question, which is at least recognized by the app (if not actively displayed within it)
• The ability to assign different points and corresponding messages on the map

Which brands use proximity marketing beacons?

With beacon technology being adopted more widely, plus tangential technology such as Bluetooth-enabled WiFi access points and lighting becoming more prevalent, the barriers to beacon marketing are becoming less and less. The barriers at the other end of the process are also disappearing. Most people nowadays own a smartphone, and many leave their Bluetooth on generally in order to quickly pair with devices such as headphones or in-car entertainment systems. Unsurprisingly, some major brands are now leveraging beacon marketing as part of their overall marketing strategy.

• Multiple brands, including McDonald’s, have utilized beacons to draw people into the restaurants, by alerting them to deals and offering them discounts as they draw close to the front of the restaurant. This is an excellent example of how it isn’t only customers who are already inside a retail location and may already be showing an incentive to buy that can be targeted with beacon marketing.
• Tesco utilized beacons to highlight offers to users via notifications when they were in a relevant part of their stores. For example, if a user was in the freezer section, they received a notification about a particularly strong offer on a certain brand of ice cream.
• It isn’t just traditional retail locations that can benefit from beacon marketing. For example, Levi’s Stadium, home to the San Francisco 49ers NFL team, installed beacons which, as well as offering navigation and positioning, allowed customers to order food directly to their seats, which resulted in a large increase in concession revenues.
• Beacon marketing doesn’t always have to target customers or users. Certain brands, such as Woolworths are using the user’s proximity to a beacon to aid them in click and collect. When a user is within a certain vicinity of the store and has requested a click and collect order, the system lets the staff know that the customer is approaching and that it’s time to start preparing their order. 
• Perhaps the most prominent example of beacon powered retail and beacon marketing in recent times has been the cashier-less Amazon Go stores, which monitor which items have been taken from shelves by which users and charges them accordingly.
• Convenience stores such as those operated by Nisa have made the most of the analytical opportunities presented by beacons, attaching trackers to their shopping carts to monitor underutilized areas of their stores and where bottlenecks are occurring.

Knock-on benefits: data analytics

The benefits of beacon marketing don’t just end with the marketing campaign itself. Any marketing campaign, regardless of the degree of its success, can be a treasure trove of useful insights and information after its completion. 

The same is true of beacon marketing. The data can tell you everything from which areas of your indoor location aren’t seeing much footfall to where users are taking perhaps unexpected routes through your location. You’ll also be able to see which messages elicited the most effective response from users, and which didn’t complement their location well. 

This data can be invaluable for businesses when looking to optimize not only future campaigns, but also things such as the layout of their retail locations.