How beacons and mobile wallets can improve customer experience

It’s been said that beacons will revolutionize search by creating more contextual experiences inside retail stores.

Businesses ranging from Macy’s to Starwood Hotels & Resorts have launched beacons (with great fanfare) to share micro targeted content and improve the customer experience. But beacons in and of themselves do not create customers. 

Enterprises with multiple locations should view beacons in context of a location-based marketing strategy that capitalizes on mobile wallet offers to connect with customers and convert them. 

What are beacons?

Beacons are low-powered devices equipped with Bluetooth Low Energy (BLE). As long as a consumer possesses a Bluetooth-enabled smartphone capable of picking up BLE signals, businesses can use beacons to deliver location-based content to people when they are close or, more likely, inside a store. 

Beacons appeal to businesses because the devices make it easier for the store to share contextual content such as offers about special sales and deals delivered to shoppers’ smartphones while they’re in or near a location.

Although beacons are still considered an early-stage technology, a number of businesses around the world are experimenting with them. Examples include:

• Levi’s recently deployed beacon-enabled billboards prompting customers with an offer and driving them into nearby stores. Consumers close to the billboards could scan the ads with their smartphone and receive a notification of a nearby store and a promotional offer.
• Lord & Taylor began testing a location-based coupon app called SnipSnap in May 2014. The retailer delivered mystery coupons to shoppers when they were about 1,600 feet from a store. According to Lord & Taylor, the engagement with push messages was as high as 50 percent, and the “click-to-claim” coupons showed 20% results.

When you hear about big-time brands experimenting with beacons, it is certainly tempting to test the waters. After all, who wants to be left behind by a disruptive technology? 

If the digital era has taught businesses anything, it’s the importance of being nimble and forward thinking. But we’ve also learned another important lesson: technology must follow strategy, not the other way around. With beacons, your strategy must begin with customer-centric, location-based marketing.

If you are considering the deployment of beacons, I would suggest you do the following:

Support ‘next moments’ with mobile wallet offers

Before you think beacons, take a look at your location-based marketing strategy and identify where you can turn ‘near me’ moments of discovery into ‘next moments’ of conversion. 

The next moment is the action that occurs after someone has found your brand through a location-based search, usually on a mobile device. Examples of next moments include:

• On its location landing page, a retailer features an offer for 20% off one item, and the offer can be downloaded to a consumer’s mobile wallet (compatible with both Apple iOS and Android).
• The same retailer, noticing that a shopper has downloaded but not redeemed the 20% offer within a certain amount of time, reminds the shopper that the offer is due to expire soon.
• Using GPS, the retailer sends a notification to the consumer when he or she is near the store location to drive conversion. In other words, location-based mobile retargeting.

Beacons can help you create next moments when you couple them with mobile wallet offers. But because of their limited range, beacons are going to be less useful to drive shoppers to your store unless your location exists in a densely populated area with heavy foot traffic close to the store. 

They may work best for creating next moments with customers after they have entered your store.

If your primary local marketing need is to generate more traffic by attracting shoppers outside your store, beacons might not help you achieve your goal, whereas GPS technology might be more useful. 

Moreover, using beacons at scale requires heavy lifting and maintenance. An enterprise needs to make sure they are all installed correctly (probably multiple beacons being needed for a large store) and maintained (they can break, become lost, or require new batteries). 

By contrast, using the right automation tool, an enterprise can scale unique mobile wallet offers across thousands of locations efficiently without requiring any beacons.

Understand customer needs

By understanding the wants and needs of your customers first, you avoid spamming them with content. Before you try to deploy beacons, first do a gut-check with your customer survey data and answer some fundamental questions: 

• Why do your customers visit your location?
• Are they looking for deals primarily (which might be the case for a large chain retailer)?
• Or is the overall customer experience their primary motivator (which might be the case at high-end boutiques, where personal service and ambience come into play).

Knowing the motivations of your customers will inform whether you deploy beacons at all, and if you do, how you deploy them. We think of beacons residing at the intersection of location, customer need, and your brand.

Beacons can succeed when they meet your customer needs by improving your service at the location level. 

Set realistic goals 

Take a close look at your customer service metrics and set realistic goals. What are your customers telling you about your service levels? Do you have a fundamental service problem that needs to be fixed?

Beacons won’t make a bad customer experience better. They can make a good one great though. Are you using them to solve the right problem?

Do your homework

As with any emerging technology, beacons are constantly evolving. Make sure you research carefully their limitations (e.g., they have limited range), resource requirements (ranging from marketing to information technology) and costs.

But most importantly, first take another look at your location-based marketing strategy. Coupling beacons with a strong mobile wallet offer in context of a location-based marketing strategy will deliver customers to your register, not just to your storefront.