CHICAGO — Bluetooth beacons are gradually appearing in more stores, and some experts predict their use will grow more rapidly once the devices establish a strong link to payments and other vital retail systems.
The key to establishing this link is to understand that beacons — small devices that communicate with shoppers through a Bluetooth signal — do not have to be used as an isolated technology, said Sampo Parkkinen, director of product management for ShopperTrak.
"Beacons have to connect to the point of sale, to the marketing campaign and even to the HVAC system," Parkkinen said as part of a discussion Oct. 22 on the potential and challenges of beacon technology in retail settings during the annual RetailLoco conference. "A beacon can tell the retailer how many people are in a store at a given time, and you can adjust the heat or air conditioning to save money."
However, retailers must also market the benefits of using their mobile app to ensure that the consumer has it on when entering the store; otherwise, the process can be somewhat of a guessing game as to whether the consumer is using the proper mobile app or wallet, Parkkinen said.
Technology vendors are placing more emphasis on beacons as a tool to effectively interact with consumers who use mobile wallet apps on their smartphones. Yet, those in the payments industry admit that these are early days for both the beacon technology and merchant and consumer adoption of mobile wallets.
But even in this early period, there are clear examples to show how beacons can increase sales and digitize consumer payments.
During the Stanley Cup playoffs last year, mobile engagement provider Gimbal partnered with the National Hockey League to place beacons in retail outlets in the cities that had a team participating in the tournament.
"We were targeting fans who used the NHL app during the playoffs through geolocation and by putting beacons in places like Dick's Sporting Goods," said Alan Simkowski, vice president of business development at Gimbal. "When those fans were near or in the stores, the retailer could steer them toward buying playoff gear, and possibly pay with the app."
Aruba Networks worked closely with Levi's Stadium in Santa Clara, Calif., the home of the San Francisco 49ers football team, to deploy 1,000 beacons throughout the stadium.
As a result of this deployment, the stadium saw a $1.2 million increase in revenue through its mobile app, said Julia Farina, senior product marketing manager for Aruba Networks. "The app is like having a new POS device," she added.
Beacons can help determine how long a customer has been in a store, how much they spent and how they paid, said John Sharry, director of sales, enterprise retail for Swirl Networks. Retailers can use this data to better communicate with shoppers and improve sales, he said.
"Retailers are seeing significant lift in the use of the native retailer app, and loyalty cards are part of that," Sharry said. "There's just a big lift in conversion rates and basket size."
United Airlines is choosing geo-mapping as a way to alert its customers about any changes in their flights and to give them the option to book and pay for a new flight if one is canceled, said Jeff Ulrich, senior manager of e-commerce and digital for United.
"We have heard about beacons for the past two or three years, but we were getting our mobile app up and operating," Ulrich said. "The last thing we wanted to do was send a Starbucks message [through a beacon] to someone moving around the airport."
But now United is excited about the prospect of deploying beacons in airports to interact with its app for indoor mapping because it will help the airlines know where passengers are within the terminal at any given time, above and beyond knowing they purchased tickets and checked in, Ulrich said.