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6 things marketers need to know about beacons

James A. Martin | Feb. 25, 2016
Bluetooth 'beacons' are a simple way for marketers to communicate with customers in physical locations, but the platforms and infrastructure behind the tiny wireless sensors can be quite complex. Here's a quick guide to the basics of beacons.

Too often, enterprise marketers get excited about the potential to reach customers in new ways, according to Michele Pelino, a principal analyst with Forrester Research and coauthor of the report, "but they don't think about who will manage the beacons over time, what the full business costs will be, what happens if something goes wrong with the beacons, or what to do if their signals overlap another store next door."

Many different firms manage enterprise beacon deployment and the maintenance of mobile-marketing or customer engagement efforts, including Aruba, Swirl (for retailers), Proximity Sense, Gimbal, MOCA, inMarket and Rover.

Most beacon-based marketing efforts are immature at this point, however, according to several analysts interviewed for this story, because marketers are still trying to figure out how to leverage the technology. Krista Garcia, a retail analyst for eMarketer, recently visited three stores in Manhattan that she knows uses beacons: Sephora, Macy's, and Lord & Taylor. Her goal was to receive location-aware offers and notifications in the stores. Of the three retailers, only one deliver an in-store offer — a Macy's promotion for Dolce & Gabbana perfume, which Garcia got when she wasn't even in the perfume department. (She was on the same floor, though).

Marketers must tread a fine line between enabling better customer experiences and annoying those people with too many messages, according to Mark Hung, a research vice president with Gartner. "Retailers are still trying to figure out the best way to engage customers, and the last thing they want to do is alienate them by pushing coupons that annoy them," he says.

Beacons can also raise privacy and security concerns. They typically transmit to mobile apps on users' smartphones and may "ask permissions for things people don't quite understand," says Kurt Roemer, chief security strategist at Citrix. When consumers accept those requests, "beacons can install software, access contacts, your location — they can do anything on your phone you can do," Roemer says. "CMOs and digital marketers should ensure that consumers are aware of privacy policies associated with beacons, or lack there of."

(This blog post lists a number of beacon-related security best practices for marketers.) 

6. What's next for beacons? 

Beacons are still a nascent technology. After the initial hype around beacons during the past year or two, some observers say they are likely to go the route of the QR code and remain a niche technology.

Others, such as Gartner's Hung, say beacon deployments will continue to grow, as a way for marketers to reach customers and as a logistics technology, helping companies manage assets in large facilities. And beacons are also being used in many new ways, such as helping to guide blind commuters through London's Tube system, according to Wired.


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