Demystifying Beacons: What They Are & How Marketers Use Them
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Retailers are falling in love with beacons, small Bluetooth devices that interact with apps to send messages to smartphones. They’re deploying them by the thousands, with Macy’s alone placing over 4,000 beacons in the US retail stores. Matthew Davis, VP of Product Marketing at mobile startup Reveal, demystifies this rapidly growing marketing channel. Attendees will hear a brief overview on how the technology works, who is deploying them and where, and how many (over 70,000 installed already in the US alone). The presentation then turns to concrete examples of how major retailers use beacons to increase customer engagement in real-time, and how other companies use beacon data to build targeted audience segments over extended periods of time.
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Demystifying Beacons: What They Are & How Marketers Use Them
- 3. MATTHEW DAVIS VP PRODUCT MARKETING REVEALMOBILE.COM
- 4. Place holder for beacon map
- 5. WTF?
- 6. BEACON BASICS HOW COMPANIES USE THEM WHY MARKETERS LOVE THEM
- 7. BEACON BASICS HISTORY WHO MAKES THEM HOW THEY WORK WHERE THEY ARE
- 8. 09.18.2013
- 19. FIRST Emits the iBeacon / BLE signal THEN An app recognizes the signal THEN Push a message to the user immediate near far
- 20. Beacons Don’t Collect Data App Installed Bluetooth On Accept Push Notifications PRIVACY…
- 21. iOS 7 and above Android 4.4 and above Mobile Websites Apps BEACONS WORK BEST ON
- 25. Proximity Marketing/In-store Engagement Indoor Navigation Payments & Customer Check-ins RETAIL USES
- 26. ENGAGEMENT
- 28. UPSELL
- 31. HOW COMPANIES USE BEACONS OVER TIME
- 32. MOBILE WILL ACCOUNT FOR 72%OF DIGITAL AD SPEND BY 2019 eMarketer.com, Mar 2015
- 34. THE ROOT OF THE PROBLEM…
- 36. WHERE DO BEACONS FIT IN?
- 37. LAT / LONG STINKS
- 38. Place holder for beacon map
- 41. THE POWER OF AUDIENCE DATA Location Only
- 42. THE POWER OF AUDIENCE DATA Location Only Beacon Location
- 43. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender
- 44. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender Age Range
- 45. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender Age Range Income
- 46. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender Age Range Income Home Ownership
- 47. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender Age Range Income Home Ownership Behaviors / Interests
- 48. THE POWER OF AUDIENCE DATA Location Only Beacon Location Gender Age Range Income Home Ownership Behaviors / Interests Family Status
- 49. RETARGETING
- 51. ATTRIBUTION
- 52. LIFE CYCLE At Venue Local Content Local Ads 1 Week Later Retargeting 1 Month Later Attribution
- 54. “The only thing worse than ads? Bad ads!”
- 55. WHO FITS?
- 57. WHY SCALE MATTERS A LOCAL RETAILER 500 DOWNLOADS 150 DETECT BEACONS 15 VISIT ONCE PER YEAR
- 58. WHY SCALE MATTERS GROUPON MILLIONS DOWNLOADS 1000’S DETECT BEACONS DRIVES NEW FOOT TRAFFIC
Editor's Notes
- Welcome to “demystifying beacons”. Let’s start with the simple question. If you know what a beacon is, please raise your hand For those with your hands up, have you ever seen a beacon in real life? Treats! This is what they look like!
- These are two types of beacons. The one on the left is battery powered, the one the right can be plugged into an adapter and stuck in an electrical socket. They’re small, but don’t let their small size fool you. These things are causing a ruckus.
- I’m standing in front of you today because I’m VP of PM for Reveal, a mobile audience analytics platform that performs beacon detection. this is my second mobile startup in the last 5 years did undergrad at UNC at biz school here at NCSU One more quick show of hands - does anyone in here manage an app with 100K or more monthly users? Great - I can’t sell you anything, but a little context will shed light on why I know what I know. We’ve been working with beacons for over a year. We have a little bit of code that goes inside mobile apps. When it’s in there, it can detect beacons anywhere in the world.
- Here’s a small sample of that data, showing beacon hotspots around the country. In the last 12 months, we’ve detected over 70,000 beacons in the US alone, which starts a single, very important and critical question…
- When did this madness start?
- By the time you walk out of here, you should be one of the more informed people in the entire state of NC on beacons. As close to a beacon ninja as you can get in 30 minutes. We’ll share the basics of their history, who makes them, how they work, privacy, and growth how companies are using how marketers should think about them
- The buzz about beacons began when Apple launched iOS 7 on Sept 18, 2013. A small and understated feature was support for iBeacon. Apple’s stated objective was to simplify paying with a mobile phone at checkout and make real-time offers based upon location much more seamless. That last point – real-time offers – that’s what’s really causing the buzz.
- Marketers sensing an opportunity to reach people in a new way, quickly started digging around like squirrels looking for nuts and immediately reacted “oh snap!” this can be buckets of gold!
- If we can figure out exactly when someone walks through the door and send them a welcome message, coupon, offer, or open up the app kick off apple pay at the register, I’m gonna sell more stuff! I’m gonna do it all day every day! Customers will love it if we send them non-stop offers!
- what happens when… you get too many emails you get too many text ads now walk through a mall outfitted with beacons and you get a coupon for EVERY place you walk by, whether or not you opted in for it...what happens? when marketers get really excited, that means we’re planning to use it so much, we run it into the ground and you end up here
- oh but this time it’s different...it’s not SPAM...it’s mobile marketing this sounds bleak, but we’re are going to unpack this To understand why marketers are geeking out over these things, we first have to dig in to how they work
- land grab, gold rush to be a beacon provider, manufacturer, or mgmt tool Typically cost between $15-30 costs are dropping - value is not in the hardware, but in software and data. It’s a commoditized product not yet a manufacturer? Apple
- iBeacon then, and still today, does not refer to the actual physical hardware or device. iBeacon is not a product you can buy. While Apple really helped popularize beacons, “iBeacon” is Apple’s standard for transmitting Bluetooth signals. Huh?
- Beacons emit a bluetooth signal comprised of three primary components. A UUID, a major, and a minor.
- Did I just put you to sleep? Tell me you werent just thinking about the smart sneak…slowly, surreptitiously grabbing your phone to check Twitstagram? He’s gonna talk code, and I don’t do code.
- This is a very simple concept understand. This little beacon pushes out those three identifiers The UUID is frequently the parent org. That big long UUID I shared with you? That’s the primary identifier for all the beacons at ALL MLB stadiums. Aha! Pretty cool. So if that’s the code for all of MLB, how does the MLB keep straight which beacons are in which park? The Major typically represents the primary location. In this case, Fenway park. The Minor number is assigned to the very specific location, like where they sell various street meats All the other beacons at Fenway have the same UUID, because it’s MLB, the same Major – that’s the identifier that says “I’m at Fenway”, and then their own unique minor to distinguish where it is in the park.
- Let’s do one more example just to make sure it sticks. As an organization, Macys picks one UUID as the top level identifier for all it’s beacons It assigns a major number to all the beacons it places in their Southpoint Mall location in Durham Then this individual in the Men’s Dept is assigned the minor # of 12
- Beacons do not collect data, apps do. They’re just dumb radios broadcasting a signal. That’s your first opt-in level. It’s the apps that collect the data. Don’t want this? Don’t download the app. 2nd – end user has to have bluetooth turned on. We see BLE enabled across 30-40% of an app audience Finally, If you’re going to receive offers, must accept push notifications
- Beacons work best on iOS7 and above, Android 4.4, they do not function with mobile websites at all, and require an app to detect them.
- 30K estimated by MediaPost My company discovered 70k Business Insider forecasts 500K by end of 2015 and 4.5M by 2018
- Macy’s -> Shopkick 4000 beacons for Deals, discounts, recommendations and rewards DFW – 100 beacons in terminal D – being used by American, but will be able to be used by any airline with an app and beacon recognition Walgreens – Duane Reade 10 stores – offers, coupons and product info Lord & Taylor -> SnipSnap Safeway -> inmarket Virgin -> boarding passes SXSW – Registration Apple – deployed in all stores MLB – All stadiums – limited roll out but using it to welcome fans, present offers, seating maps and directions…
- The way in which marketers and companies are deploying beacons are really a function of time. Most people today are focusing on real-time uses of beacons. There’s a lot of value here. We’ll also explore how to leverage beacons over extended periods of time to build incredibly valuable audience data.
- The early focus with beacons is on retail usage. Deliver relevant offers when you walk through the door Help customers with indoor navigation Or automate/simplify checkin and payment with mobile phones
- But by far, the most emphasis has been on increasing customer engagement. That is, the app detects the beacon, sends you a push notification to alert you to specials, offers, coupons, information that you absolutely must have right now!
- A creative use, one that we believe we’ll see soon, altering the UI of an app based upon your beacon-verified location. The Home Depot’s app could function as an ecommerce site when you out of the store, but when you enter and bump that beacon, the UI changes to reflect in-store navigation.
- Sports venues are already experimenting with real-time upselling at events. If youre like me, you have a wife, a 7 year old boy, 5 year old boy/girl twins, so you’re always buying the cheap seats. Beacon-powered upselling recognizes you’re at the game, and prompts you to take the unsold lower level seats at a nice discount. Win-win!
- You’re at an NFL game. As you navigate the stadium you’re served relevant content to your location – stadium history, team history, concessions. Museums are also testing location-aware content, so that you don’t have to rent the greasy headset anymore.
- Through the magic of ad tech, surface location aware ads into existing ad formats, like the banner, instead of a push notification. Warm up after the game, Dunkin Donuts only a 2 minute walk from the stadium.
- While 90% of the focus on beacons today are the real-time use cases, Let’s now explore how companies should think about beacons over extended periods of time. I’m very passionate about this space, so we have to take a step back to explain the passion.
- It’s no surprise to you that mobile usage is skyrocketing. The telling statistic is the 72% of all the money spent on digital advertising is expected to be on mobile devices by 2019. But there is a huge problem with this.
- This is a screenshot from my phone, serving me an ad for taking birth control. This happens billions of times per day. Why?
- There are no cookies in mobile. They just don’t work. Today they track your usage across traditional websites, putting you into anonymous audience segments. Male, 35-44, likes French Poodles, whatever. This ability for advertisers to find their target audience in mobile is almost nonexistent.
- But a few companies are doing incredibly well selling mobile. These guys. They do so because they know more about you than you do. Together, they command over 50% of all the money spent on mobile advertising today. Impressive.
- Latitude and longitude, the location of a device, has been hailed by many as the “cookie’ for mobile. Only 34% of ad requests with location information were accurate to within 100M The blue dots in here represent what the smartphone said it’s location was. The yellow dot is the actual location, which is the Dallas Fort Worth airport.
- Think back to the 70K beacons we’ve detected thus far, and that it’s going to over 4.5 in 2.5 more years. We’re building a database of verified locations
- As a device navigates through the real-world, bumping into beacons at airports, at stadiums, at coffee shops, at stores, you end up with these same anonymized audience segments that advertisers are demanding in mobile.
- Now, in my opinion, we’re stalking to talk about a pot of gold. Here’s a visualization on how beacons, along with a few other technologies, make this process work.
- In addition to this rich audience data, you’ve now got more sophisticated advertising solutions available. When you can validate someone visited a location, you can build various retargeting segments VIP customers Win back offers Related offers based upon previous purchase
- There’s also potential to reach the holy grail of advertising by demonstrating attribution.
- There’s also potential to reach the holy grail of advertising by demonstrating attribution. Dunking places a beacon in their stores Dunkin delivers ads on smart phones, and measures which devices saw those ads The device comes into the Dunkin, with the visit being verified by the beacon bump, voila This device saw this ad then came in the store a few days later – attribution.
- The marketers that are geeking out about beacon technology certain love it because a) It’s the shiny new toy to play with. B) you can do really interesting real-time marketing with them, and C) the ones that are thinking a step ahead, know that the data will be immensely valuable.
- It’s very easy to become Statler and Waldorf, the two grumpy old men from the Muppets, and say that beacons will fail, and they’re just the next QR codes, but I don’t believe so.
- While there’s enormous future potential, we must be realistic about who is a fit today. The biggest hurdle this approach faces right now, and the limiting factor on who is a fit, is that you must have an app to take use of beacon technology. Companies with large app distribution will be able to take the most advantage of beacon technology, because they’ll have the scale of end users to matter. I believe that today, most retailers are not a fit for beacons…yet. If you’re a local business, you don’t need an app. You need a simple and easy-to-use mobile website and someone greeting you when you walk in the door. On the flipside, both Facebook and Groupon are testing beacons with local merchants, and this play may work. They do the heavy lifting of massive beacon installation, and have big enough scale for beacon-powered offers to work and drive more foot traffic. End users are expecting relevant advertisements and offers from those platforms.
- To highlight the reason that scale of app downloads or monthly app users is an issue, let’s walk through an example… You own a chain of 5 local clothing stores and you decide to launch an app Optimistically, 500 people download it Of that, maybe 30% will have Bluetooth turned on, so 150 people. Of that 150, maybe only 10% visit your store once a year You’ve now invested serious time and money in providing maybe 10-15 people already at your store with a push notification on their phone. Wouldn’t it be better just to greet them? Going back to Groupon and Facebook testing these. With their app install bases in the hundreds of millions, your offers can reach new customers that have opted for notifications from nearby merchants. This has power to drive more foot traffic.
- Going back to Groupon and Facebook testing these. With their app install bases in the hundreds of millions, your offers can reach new customers that have opted for notifications from nearby merchants. This has power to drive more foot traffic.
- Going back to Groupon and Facebook testing these. With their app install bases in the hundreds of millions, your offers can reach new customers that have opted for notifications from nearby merchants. This has power to drive more foot traffic.
- First, and the most immediate, is that they begin to serve as a real-world cookie. This can and will be hugely powerful for mobile targeting and mobile advertising.
- And pulling that out to a little bigger picture, they’re bridging together the digital and physical world. your smartphone enters a physical space and takes a digital action. a physical space is communicating with a digital device beacons allow the URLification of physical spaces. pretty cool