Technavio’s Tech Tuesday: iBeacons and Their Role in Retail Marketing

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Apple’s version of a Bluetooth based beacon, the iBeacon is a device that makes use of BLE (Bluetooth Low Energy) to provide location-based information and services to iPhones and other iOS devices. By offering effective micro-location, presence detection, and contextual communication, iBeacon technology not only provides an interactive digital experience to consumers, but has also redefined marketing and sales strategy for the retail, transportation, logistics, and healthcare sectors.

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iBeacons and retail marketing

Regarded as the “most important retail technology since the mobile credit card reader”, iBeacons help retailers provide enhanced experiences for their customers through innovative marketing strategies such as proximity marketing, thereby increasing sales of their products and services. The majority of today’s brands are looking for ways to create a seamless experience for their customers both online and offline. iBeacons help companies to achieve this by providing better insights on their customer base and enabling them to match customer requirements with the right messages at the right time and place. One example is that retailers can now target consumers through apps by alerting them about special offers when they enter a store. Another example is when customers have placed certain items in their mobile shopping bag, they can opt to receive ‘near-store notifications’ that will alert them if an item in their bag is back in stock when they approach the store. This process is enabled by a beacon placed at the store’s entrance.

Loyalty points and programs play a vital role, not only in increasing sales, but also in customer retention. In fact, in the latest joint report by Manta and BIA/Kelsey, over 60% of brands reported that half of their revenue comes from repeat customers rather than new ones. This is where iBeacons come in. Their proximity-based detection feature allows businesses to send customized alerts and loyalty program updates to customers based on their shopping behavior and personal details, such as birthdays. Not only does this engage the customer in a more successful manner, but it also helps to achieve long-term loyalty.

iBeacons have emerged as the leading technology standard used in Bluetooth beacon devices. Analysts at Technavio predict that the global Bluetooth beacon devices market will grow at a staggering CAGR of around 223% by 2020.

Standardization of BLE technology and the increased use of mobile apps for shopping purposes are two major factors that have further boosted the growth of the Bluetooth beacon devices market, especially in the iBeacon segment. Other market drivers include the low cost of implementation, moderate consumption of energy, and reliability.

Apart from being beneficial for B2C (business-to-customer) marketing campaigns, iBeacon have the potential to enhance B2B (business-to-business) marketing as well through events like trade shows and conferences.

View the 2016-2020 Global Bluetooth Beacon Devices Market Report