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Can Facebook Bring Beacons To The Mainstream?

Apple laid the groundwork for these indoor positioning devices, but the social network may be the ultimate popularizer.

veselka window
Indoors at Veselka

Jason Birchard, who runs East Village pierogi institution Veselka with his family, had never heard of beacons until a Facebook social media rep walked into his 60-year-old restaurant to discuss testing the Bluetooth-powered devices earlier this month.

“They were looking for establishments that would be open to the idea of using beacons as part of a test,” said Birchard, seated at a table that looks out on to Veselka’s E.9th St. corner. “I think we appealed to them because we’re open 24 hours, we have a lot of college students coming in, and we’ve been in the neighborhood a long time. I can see the potential for certain benefits for us: it can give us direct feedback and gives our customers the option of seeing what their friends have enjoyed about their experience here.”

NYC Is The Place

The day before, on Jan. 29th, as Facebook was introducing Place Tips in its 1.3 billion members’ News Feed, about half a dozen Facebook staffers were at Veselka installing a white, diamond-shaped beacon above a “No Smoking” sign near a side entrance.

“It’s a no charge, non-committal arrangement and we can quit anytime we want,” said Birchard. “And if we learn something about our customers and this technology, one way or the other, it’s a no lose proposition.”

Place Tips duoIn addition to Veselka, Facebook is also testing its beacon/Place Tip combo in several other New York City locations: The Metropolitan Museum of Art, Dominique Ansel Bakery, Strand Book Store, the burger joint at Le Parker Meridien Hotel, Brooklyn Bowl, Pianos, the Big Gay Ice Cream Shop. The Brooklyn Bridge and Central Park are also part of the pilot program.

A Facebook rep tells GeoMarketing that the social net eventually intends to provide Place Tips around the world, however “we don’t have a specific timeline to announce right now for the further roll-out.”

While Place Tips is being viewed as a potential “Yelp-killer” in some quarters, the current test hardly seems like a replacement for other review sites so much as an obvious extension of what Facebook has already been doing with its approach to small business and location.

For now, Place Tips pulls from existing information on businesses’ Facebook Place Pages, like upcoming events. This pilot is focused on learning about how people use and get value out of Place Tips, the Facebook rep notes. “But we’ll be doing research to see what kinds of Place Tips information people find valuable, and what other information we could add to Place Tips to make the experience more valuable for people, and places/businesses.”

Beacons Get Into Position

Beacons got their first major push into the mainstream in the summer of 2013, as a tool for connecting indoor navigation with smartphone apps. At that time, Apple listed the inclusion of its “iBeacon” platform in its update of iOS 7. When it came time to unveil iOS 8 in the fall of 2014, Apple CEO Tim Cook actually mentioned beacons from the stage during his big presentation, and it appeared that the beacon moment had arrived.

As we’ve reported over the past several months, major retail brands like Lord & Taylor, Target, American Eagle, Starbucks, Best Buy, Alex and Ani, Old Navy, and others, have either implemented or expanded beacons for in-store marketing purposes. In one of the biggest endorsements for beacons— made just in time for the 2014/2015 holiday season— Macy’s expanded its relationship with shopping app platform Shopkick to install the Bluetooth devices in all its 4,000 US locations. In a further sign of that beacons have made the grade, South Korean location-marketplace SK Telecom acquired Shopkick in September for an estimated $200 million.

i iconIn addition, companies that provide the hardware and software platforms for beacons have also been springing up the past several years and many appear to be hitting their stride in the wake of Apple’s proximity marketing push. Aside from Shopkick, those companies include GPShopper, Gimbal, Swirl, Estimote, StickNFind, Euclid, and inMarket. Elsewhere, companies like Finland’s IndoorAtlas and Bytelight are offering marketers an alternative to Bluetooth beacons with micro-location technologies like magnetic positioning and LED lamps, respectively.

Facebook isn’t identifying which company is behind its beacon program — though, assuming it will, we can predict that beacon provider will surely get a huge promotional boost. Granted, a lot will depend on whether this latest test succeeds. Despite Facebook’s power, beacon future is far from guaranteed.

A Cautious Approach

As Birchard’s comments above show, the awareness of beacons as a useful information gathering and marketing tool remains lost on most businesses and consumers. And when consumers have heard reports about the use of beacons, the stories have tended to be loaded with “big brother” fears of privacy violation, as was the case with a rather innocent test of Bluetooth devices in several New York phone kiosks by outdoor ad agency Titan back in October, a test that was subsequently aborted after it resulted in some negative press.

For those reasons, Facebook is taking a very cautious approach to their beacon test. (Incidentally, back in 2008, Facebook was forced to pull back on its Project Beacon, which shared details of members’ purchases in their News Feeds, after members and privacy advocates protested.)

This current Facebook beacon project, like all beacons, requires that consumers actively opt-in by turning on their device’s Bluetooth receiver and allowing the Facebook app access to its location services.

dominique ansel place tipsThis relatively soft launch of Place Tips is also heavily tilted towards utility, not commerce — for now. As such, Place Tips goes beyond Bluetooth beacon sensors and also uses signals from cellular networks, wifi, and GPS, which perform well in large open spaces like parks, airports, and landmarks.

“But in a block of small, densely-packed businesses, like in Manhattan, Facebook Bluetooth beacons help us make sure we’re giving you the right information for the right place, so we can provide you with the most useful content only when it’s actually relevant to you,” said the Facebook rep.

In that sense, Place Tips is the lead tool here. But if it can introduce consumers and businesses to an acceptance of beacons as just another way to access information on their phones; and one that could lift the presence of beacons for other businesses as well.

The reasons are simple: Facebook’s 1.19 billion mobile monthly active users (as of December 31, 2014, according to the social net’s most recent figures) is something that even the most popular brand apps can’t compete with in terms of both scale and regular usage. In other words, if Facebook can’t get its addicted members to opt-in to beacons, then who can?

And few companies can be as patient as Facebook when it comes to building beacons as an extension of advertising business. As evidenced from Facebook’s Q4 earnings release this past week, the social net accounted for roughly 7.8 percent of the global digital ad market in 2014, up from 5.8 percent in 2013, according to research from eMarketer.

So don’t expect any sudden advertising within Place Tips and its beacon system just yet.

“There are no ads in place tips currently,” the Facebook rep said. “We may explore that in the future, but for now, we’re focused on testing how valuable this core experience is for people. That’s something we really want to get right.”

A GeoMarketing Test

no smokingIn the meantime, spreading the word and making sure people understand how to use Place Tips’ beacons is going to be the real challenge.

When I was at Veselka on the day following Place Tips’ release, I turned on my Bluetooth signal (something I rarely do) and also checked that my iPhone 6’s Facebook settings allowed it to access my location (I generally have location services set to “when using the app.”)

It took about a minute and I noticed a pink, circular icon surrounding a lowercase “i” prompting me to see “posts by your friends at Veselka.” I clicked and it opened up comments, images that represented a showcase of the restaurant’s Places page, as well as a list of menu items. That was about it. Then, Birchard showed me his iPhone, which allowed him to pull up a survey where users can rate the restaurant’s food and service, something I couldn’t access.

I asked the Facebook rep if I my settings were wrong of if there was a problem with my iPhone’s settings. Nope, the rep said, there were no issues on my end.

“You may not have seen the survey since we’re testing different units with place tips during this pilot period,” the rep said. “Over time, they’ll be more consistency in the modules you see there.”

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.