How Apple’s iBeacon Will Help You Spend More While Shopping

Source: Thinkstock

Source: Thinkstock

At select locations of a North American department store, your shopping experience is about to get smarter and more interactive. Mashable reports that HBC Department Store Group, which owns both Lord & Taylor and Hudson’s Bay, has worked with iBeacon provider Swirl to roll out its implementation of the Apple technology to select stores in the U.S. and Canada on Monday. The goal is to begin offering shoppers a more unique, interactive shopping experience with the help of their mobile devices.

iBeacon is Apple’s system to use Bluetooth low energy technology to provide location-aware information, offers, and services to iPhones and other iOS devices. (The technology is also compatible with Android devices.) The beacon itself – like the SecureCast Beacons offered by Swirl — is a small, battery powered device with a Bluetooth transmitter built in. Apps on your iPhone, like an app you’ve installed for a specific retailer or store, can receive alerts from the beacons positioned in various places around a store, and display messages like special offers, or more information on a specific product or display that you might be standing in front of.

The beacons are placed strategically to detect when you (and your iPhone) are in a specific part of the store, so that the alerts can increase your engagement with the store and products, reward loyalty and repeat purchases, and in general influence your buying decisions. When you enter a store, as an example, you could see an alert for a coupon for say 10 or 20 percent off a purchase, which could make it more likely that you’ll buy something. Or if a beacon detects that you’re walking through a specific part of the store — perhaps the shoe section of a department store — you could get an alert notifying you that specific brands of shoes are temporarily marked down as part of a promotion.

In addition to providing location-based alerts, iBeacons can combine location information with existing customer data. As Mashable explains, Lord & Taylor might already know that you like to purchase clothing by a specific designer. Maybe you’ve bought clothes by Ralph Lauren, as an example, for the past three seasons, and you’ve recently placed Ralph Lauren items on your Wish List as well. Combining that knowledge with a beacon’s awareness that you’re in the section of the store where Ralph Lauren clothes are stocked, the system could notify you that some Ralph Lauren items are part of an ongoing sale, or that there’s an applicable coupon available. That makes the shopping experience smarter, more interactive, and quite possibly more lucrative for the store.

HBC’s specific iBeacon implementation, for Lord & Taylor and Hudson’s Bay stores, uses beacons powered by Swirl. Swirl also works with brands like Kenneth Cole, Alex and Ani, and Timberland to customize the shopping experiences provided to customers, and to set specific promotions to offer via the technology. Swirl’s iBeacons are a particularly accessible implementation of the Apple technology, as Mashable explains:

“Swirl’s backend is basically an easy-to-use CMS for retailers that lets them see exactly where each iBeacon is located at a particular location. It also lets brands create offers that can be triggered based on a set of circumstances. That means that someone who enters at store in the afternoon could be shown a different coupon than someone who enters in the morning.

“Swirl’s platform also lets retailers safeguard against sending users too many alerts. One of the potential pratfalls of iBeacon technology is that brands will use it too often too quickly, before customers are educated about what it is and what its benefits are.”

Other retailers that have implemented, or are in the midst of implementing its own iBeacon systems include Macy’s, which AppleInsider reports is testing a system that correlates your in-store shopping with your online shopping. That capability, combined with the system’s ability to offer department-specific offers, will give rise to more personalization and better customization of the shopping experience.

Once retailers integrate the iBeacon technology into its apps, it will be able to draw upon what it already knows about your shopping habits and preferences. So instead of walking into a store and receiving the same alert as your friend who’s shopping with you, you could receive a different offer or a different notification, tailored to the store’s knowledge of what you’ve bought in the past.

AppleInsider notes that iBeacons are also being tested out by restaurants, with German restauranteur Christian Mook testing an iBeacon-based rewards system his Frankfurt restaurants. The system tracks information about specific customers, learning their favorite table, the amount of time that they spend in the restaurant, and what foods they order. If the initial pilot goes well, the system will learn specific guests’ names, what they eat and drink, how often they come in, and if they choose the restaurant for private or business occasions.

Even Duane Reade, the pharmacy primarily located in New York City, is experimenting with iBeacon systems to better connect with shoppers via notifications and coupons to help them more easily find what they’re looking for with maps and a product locator function.

Throughout trials by different retailers, it will be interesting to see how retailers integrate iBeacon systems with existing information that its customers share with them. As a store that you frequent develops and implements a more innovative app, integrated with iBeacon technology, you’ll gain better control and a smarter shopping experience — which will make it easier to find what you’re looking for, find good deals that a store can predict could be relevant to you, and possibly find out about more products that you weren’t already aware of.

Both Apple and retailers are hoping that that translates into a win-win situation: you get a better shopping experience, and products you like, often at a discounted price, while stores increase its conversion and improve the ways that it engages you as a customer. Depending on how current and upcoming iBeacon rollouts go — and whether shoppers find the alerts annoying or unnerving and decide to ignore them — the technology could represent a huge market and a huge marketing opportunity for retailers that are always looking for a smarter way to get a customer to make a purchase.

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