A comprehensive comparison of all proximity marketing solutions for retail (PART – 2)
Digitization is rapidly bridging the gap between the physical and digital retail experience to enhance the customer in-store experience. Business owners and marketers have adopted technologies in interesting ways. Based on their experiences, we have curated a comprehensive comparison of all proximity marketing solutions in the retail sector. Last week, we discussed how Bluetooth beacons outshine QR code and RFID in 2018 (PART – 1).
This week we will be discussing how Bluetooth beacons are competing with WiFi and NFC technologies. We will also talk about companies who have succeeded or learnt from their deployments.
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WiFi and BLE beacons
WiFi has traditionally not been a proximity marketing solution. But, with more and more companies, particularly retailers, offering WiFi in their stores, it’s no surprise that marketers are increasingly looking at WiFi hotspots as a channel through which location-based campaigns can be executed.
How does WiFi work for proximity marketing purposes?
Businesses set up several Wi-Fi hotspots and provide free internet access. In order to use it, a customer has to log in and provide their personal details. The business that hosts the Wi-Fi network can then send location-specific content to the consumer’s’ browser. Wi-Fi networks can also be used to measure foot traffic and general consumer movement.
Companies that moved away from WiFi proximity solution
- The Orlando International Airport – This airport had over 1,000 WiFi access points. So it was an obvious choice to use the existing system to implement proximity campaigns. The plan was to leverage these WiFi points to find a traveller’s location and offer directions. However, a test in 2014 showed that a WiFi determination could be 30 to 50 feet off of an individual’s actual location. This happened because the WiFi strength varies by how many consumers are using it. The airport obviously then decided against proximity campaign using WiFi.
Why does WiFi as a proximity solution have limited success?
Even with the popularity WiFi has, it is not the most powerful way of implementing proximity campaigns. Here are the reasons –
- WiFi requires users to consent to a connection each time they enter the business location.
- Setting up a WiFi-based proximity campaign can be really expensive for a small and medium business owner.
3. WiFi technology does not rely only on the proximity of consumers and hence it is not quite effective when it comes to micro locating.
Companies using WiFi + Beacons
But, WiFi and beacons are a power couple!
- Kew Gardens – The Royal Botanic Gardens, Kew, is one of the world’s oldest botanic gardens, and receives about 1.3 million visitors annually. They wanted to push information about the gardens which was relevant, timely and quality information. They deployed 21 beacons at Kew and 13 at their sister site, Wakehurst. They also had WiFi areas in 50 locations throughout the 300 acres of land. The offer to connect to free WiFi redirects the user to a page advertising “Discover Kew” mobile app for download. Once this beacon-enabled app was downloaded, visitors at Kew could interact with the beacons.
- Orlando International Airport – Post the failure of just WiFi, the airport added an extra layer of beacons to their proximity solution. Users at the airport could then use their smartphones and locate their ticket counter, terminal or gate, check their flight information, find restaurants and shops, and locate their baggage upon arrival, accurately.
- Google deployed 2,000+ Eddystone beacons in Indian Railway stations to promote free WiFi. To date, Beaconstac has helped deliver 5-10% click-through rates with millions of notifications delivered. (Google station now in India and Indonesia)
NFC vs BLE beacons
NFC was originally developed and promoted as a highly secure technology to enable mobile payments and ticketing applications enabling consumers to make payments by merely tapping their cellular device against an NFC-enabled payment terminal to conduct a transaction. The technology seemed so promising that influential industry players predicted that it would extend its use cases and vanquish all other technologies.
Seeing the momentum of NFC adoption, it was expected that more than 550 million handsets would include the technology by 2016 and mobile commerce transactions would grow to $670 billion by 2013.
That clearly did not happen. According to Statista, in 2016, the number of NFC mobile proximity payment users stood at 92.2 million.
Manufacturers stopped backing NFC
In 2014, Motorola Solutions said that manufacturers were starting to be unconvinced by NFC. That fact that it demanded users to step up and walk towards NFC tags to get information was a road blocker to a seamless experience.
Gary Singh, the WLAN product marketing manager at Motorola Solutions, said, “Bluetooth Low Energy (BLE) is one of the next areas for us to invest in because it leverages existing infrastructure… phones have moved away from NFC, particularly the likes of Apple. We are not biased but our view is because BLE uses existing infrastructure, it will have a much more rapid adoption than NFC.“
Reasons for limited success of NFC –
- The greatest hurdle to customer receptiveness to NFC campaigns is that they have to download an app to use NFC tag to receive messages. On the other hand, virtually every smartphone already comes equipped with Bluetooth and WiFi capabilities.
- Another potential barrier is that NFC ad campaigns require consumers to initiate the engagement. After taking notice of a poster or sign, they need to walk up to the NFC device to tap their smartphones to receive the message.
- Also, due to NFC’s limited transmission field, consumers must not only notice the printed ad and decide to make the connection, they must get close enough to the NFC tag to initiate the message. As the novelty of NFC tags wanes, it’s an open question whether or not consumers will be willing to read and respond to advertising messages that require that level of effort on their part.
There isn’t a binary solution to which is the best proximity marketing solution for a business. Different technologies have different capabilities and adoption rate. But, Bluetooth beacons, on the other hand, are versatile due to the wide adoption of Bluetooth among users and have far fewer requirements beyond a smartphone with mobile data access.
If you are looking to get started on a pilot for your retail store, head to our Beaconstac store page and invest in a set of beacons and our Basic subscription plan. You can have the campaigns up and running in less than 15 mins!
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