Beacons light a different way
After failing to take off in shops, beacons are starting to be used more with banks and sports stadiums, writes
Beacon technology, which was practically left for dead after failing to deliver on its promise to revolutionise shopping, is making a comeback.
Beacons are puck-size gadgets that can send helpful tips, coupons and other information to people’s smartphones through Bluetooth. They’re now being used in everything from bank branches and sport stadiums to resorts, airports and fast-food restaurants.
In the latest sign of the resurgence, Mobile Majority, an advertising startup, said this week that it was buying Gimbal, a beacon maker it bills as the largest independent source of location data other than Google and Apple.
‘‘Retail has got a lot of attention, but we actually see a huge pickup in other industries as well,’’ said Thomas Walle, chief executive officer of Unacast, which aggregates data collected from beacons for advertisers.
‘‘Now airports and transportation is probably the largest. Sports stadiums are huge.’’
Apple launched its iBeacon protocol in 2013, laying the foundation for what’s now called the proximity industry, where advertisers can target consumers based on their super-precise location.
The number of shipments of Bluetooth low-energy beacons is expected to grow to 500 million by 2021, up from 8.2m this year, according to ABI Research.
Several recent developments have sparked the latest boom.
Companies like Google are making it possible for people to use the feature without downloading any apps, which had been a major barrier to adoption, said Patrick Connolly, an analyst at ABI.
Introduced this year, Google Nearby Notifications lets developers tie an app or a website to a beacon to send messages to consumers even when they have no app installed.
‘‘With Google and Apple driving and pushing the market around new tools enabling proximity, we see this as opening the door for more enterprises adopting this technology,’’ said Brian Dunphy, a senior vice president at Gimbal.
More sophisticated software used to manage and set up beacons is making the technology more cost effective.
In the past, companies had to plaster their walls and ceilings with the devices, and keeping track of where they were and periodically replacing batteries was an expensive headache.
But in June, Mist Systems began shipping a software-based product that simplified the process.
Instead of placing 10 beacons on walls and ceilings, for example, management using Mist can install one device every 610 metres, then designate various points on a digital floor plan as virtual beacons, which can be moved with a click of a mouse.
As the market moves to virtual beacons, cost of the devices could drop from as much as $20 today, ABI’s Connelly said. ‘‘You could even be getting into cents, less than $1 per beacon.’’
Among the examples of the growing use of beacon technology:
Diebold Nixdorf announced it will integrate beacon software into its ATMs, so customers would see personalised ads on their screens. The technology can also let financial institutions detect and identify consumers as they approach a branch lobby.
Citigroup made beacons available at a few branches in Manhattan to let customers enter the lobby after hours by using their iPhones or Apple Watches, instead of bank cards.
Mobile Majority plans to use Gimbal beacons to serve more targeted ads to mobile devices. For example, if a customer visits a car dealership for two hours, a beacon would register that data.
Mobile Majority might deduce that the customer is seriously considering buying a car, and create ads to send to the shopper’s smartphone.
Fast-food restaurants are adopting the technology to let consumers order ahead easier. When customers enter the locations, beacons notify the staff, so they can put their orders out.
Hotels and resorts are using beacons to offer users turn-by-turn directions. Gimbal, which is currently deployed in 50 hotels, plans to expand to about 500 by early 2017.
The NBA’s Cleveland Cavaliers are now using about 100 beacons. Up to 80 per cent of the more than 440,000 users of its app opt in to get information from the beacons about the team’s stadium or special offers. Beacon-based ads tend to be three times more effective than sending fans e-mail.
Retail adoption, meanwhile, got off to a slow start.
Only 8 per cent of retailers use beacons today, and only 11 per cent plan to use the technology in 2017 or beyond, according to Forrester Research. By 2021, retail will account for less than 1 per cent of all beacon hardware shipments.
Part of the problem is that most consumers don’t download retailers’ apps or take out their phones when entering a store, so the coupons and offers that beacons provide stay unused. That’s not the case with sports fans or travellers.
‘‘Retail is the one that’s not doing well,’’ said Hari Gottipati, a retail consultant. ‘‘But if you look at airports and smart cities and smart homes, it’s a fast-growing market. The beacons are going to explode in the future – except in retail.’’ – Bloomberg