For Cyriac Roeding, CEO and co-founder of shopkick, the marriage of virtual and physical shopping has never as close as it is now.
"Everybody has been talking about this for years, the idea of walking around a store and making it a fully interactive experience with your mobile device," says Roeding, the founder and CEO of shopkick. "We're close to putting a physical layer on top of the digital world."
Shopkick's app rewards consumers for visiting stores, and the company is deploying new technology in an attempt to make its model more granular by reaching consumers while they are in certain parts of stores, or by matching consumer preferences expressed online to product availability in stores in real time.
Part of shopkick's strategy is ShopBeacon, an app that shopkick has deployed at Macy's locations in New York and San Francisco. ShopBeacon welcomes consumers when they enter the store and shows location-specific deals, discounts, recommendations and rewards. Merchants deploy ShopBeacon by installing a device on a wall or other flat surfacein their stores. The devices have a battery life of about five years.
"Bluetooth Low Energy technology doesn't use much battery, which is a big advantage over GPS geolocation. iBeacons [ShopBeacon's enabling technology] could keep consumers present within stores, and consequently keep them shopping," says Daniel Van Dyke, a research specialist in the mobile coverage area at Javelin Strategy & Research.
Shopkick has been working on ShopBeacon for about a year, and the app incorporates BLE and integration with the back office technology that drives shopkick's rewards program. The result is a system that's an upgrade over shopkick's pre-existing technology, which relied on ultrasonic signals sent via the store's internal music system. The ultrasonic signals are used to sense when a user is in a store or a certain part of the store.
"We're able to show you the things in the shoe department, for example. You can walk around and pick up a pair of shoes that you liked at home while browsing, or you can be alerted to a special offer while you're in the shoe department," Roeding says.
The company used geofencing for location awareness, but the new technology does a better job of locating shoppers when they are actually in the store, rather than on a street near the store, Roeding says. ShopBeacon also works deeper in a store and improves pinpoint location, Roeding says.
Another improvement is more precise and proactive alerts for consumers Roeding says. "A lot of our users say 'I love the solution but I forget to open the app. Can you help with that?' In the past we couldn't do that. The ultrasonic technology is good for accuracy, but it can't remind you do open the app."
ShopBeacon also includes the ultrasound technology, which ensures the signals stay inside the store, Roeding says. "iBeacon is about ten percent of the product," says Roeding, adding the real power comes from the ultrasound technology and an integration with shopkick's server to deliver rewards and offers. "[BLE] bleeds through walls, so you're not able to stop the signal at the entrance. We're able to use the ultrasound for verification that the person is in the store, so they aren't accepting rewards while outside the store."
A number of payment companies are deploying BLE as a longer-range alternative to Near Field Communication. Apple added support for BLE in its the new version of its iOS mobile operating system, and PayPal uses BLE in its Beacon device. PayPal's Beacon automatically checks in shoppers as they visit a favorite store. Microsoft has also tested BLE technology.
"[BLE has] the potential to transform retail payments," Van Dyke says, adding 59% of U.S. consumers own smartphones, and tablets and wearable devices are also competing for attention with the physical world. "This is a big problem for retailershow do they keep wireless consumer engaged?" Van Dyke says.