Beacons Move Back into the Spotlight

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Beacons Move Back into the Spotlight

By Paula Bernier, Executive Editor, TMC  |  October 26, 2015

Apple (News - Alert) famously brought the world smartphones and the mobile apps that account for a large part of their functionality. That helped create the empowered consumer, as we now have easy access to a wealth of information to do comparison-shopping. It also enabled what is now referred to as the on-demand society.

But when it comes to beacons – a technology that many believe will change the consumer experience, and enable brands and retailers access to more customer information to do exciting new things – Apple seems to have been early to the party but is likely to be late to the celebration.

The company introduced iBeacon a couple years ago to great fanfare. And it has announced at least a handful of users – including inMarket, Macy’s, Major League Baseball, Marsh Supermarkets, and Virgin Atlantic, according to a January MacRumors article.

Still, Apple’s beacon technology doesn’t seem to have made much of a mark, and it doesn’t seem to have invested much in the way of resources on iBeacon recently. In fact, Steve Statler, principal of Statler Consulting LLC, says Apple’s Beacon 1.0 standard hasn’t changed in two years. And if you walk into an Apple store and ask the manager (which I did) if the store has an iBeacon running, that manager may not have even heard of iBeacon or even beacons in general (which he didn’t).

Recently, however, the beacon space got a major shot in the arm when none other than Google (News - Alert) – a notable no-show on the beacon and digital payments front a few years back – came out with Eddystone, an open beacon format.

Eddystone has done for the beacon space what Donald Trump has done for presidential politics, said Statler. This statement is, of course, open to interpretation. But my read on it was that it has made beacons interesting again.

This beacon development is interesting for a number of reasons, Statler noted. First of all, it comes from Google, whose Android (News - Alert) operating system runs on 80 percent of smartphones. Eddystone will also allow for tight integration with Google’s popular browser Chrome, maps, and a lot of other great stuff. And, by the way, Google is now offering management services for beacons of all stripes; in addition to management, Google will store beacon metadata for you.

It’s worthwhile to note, Statler said, that Google is the world’s largest advertising company. (A March Business Insider story reports that WPP, which it says is actually the world’s largest advertising company, invested $2.9 billion of its $75 billion media bookings in Google ads, making Google WPP’s biggest media partner.)

Google and Eddystone also could move beacons forward in a way that Apple iBeacon and UriBeacon (also created by Google) haven’t because, as ABI Research (News - Alert) analyst Dan Shey described it, the new solution combines the best of the two – plus it addresses the transmission of telemetry. UriBeacon, he explained, relies on having a connection to the physical web – meaning a url is associated with an object. Apple’s iBeacon, meanwhile, requires an application on the phone.

Statler said beacons aren’t smart connected devices. Rather, they’re more like lighthouses. He also referred to them as  “digital cookies in the physical world,”

Beacons are useful in that they can help trigger an action, like noticing a customer is by a certain display, so a system can send that customer a coupon to incent him or her to purchase a product in that vicinity. Beacons also can enable quick and easy payments at the point of sale. In fact, Research and Markets expects that by 2019 mobile proximity payments will total $54 billion.

In a presentation at IoT Evolution Expo in August, Statler showed a Google video on hands-free payment – making the point that it can be inconvenient to fish your credit card out to pay at a restaurant or store. “Google is testing this in San Francisco,” Statler said, “and my prediction is that it will work pretty well.”

Meanwhile, Apple is combining iAd with Wallet and NFC and iBeacon, moving it closer to Google, said Statler, adding that only 15 percent of Apple phone users now employ Apple Pay.

And this MCX retailer consortium, which includes WalMart, is now in trials with its own payments system, but this one is a little kludgy and relies on QR codes, he added.

While beacons can help enable payments and deliver information and offers on the front end, on the back end, they can help offer context about who is browsing or buying what where. (Such information can be used by retailers to more effectively organize their stores and use the digital signage in them to their advantage, as just one example.)

So valuable is this kind of information that brands, credit card and other financial companies, and retailers are jumping all over themselves trying to get there first, and all of the above are starting to deploy their own beacons, Statler indicated.

Edited by Kyle Piscioniere
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