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Most Consumers Don’t Know Beacons Exist — Should That Matter To Retailers?

First Insight finds 70 percent of consumers have never heard of the Bluetooth-powered devices currently being implemented by major chains. But as proximity industry leaders tell us, that’s not the main issue brick-and-mortars face.

Shoppers' Purchase PAth (from First Insight)
Shoppers’ Purchase PAth (from First Insight)

Talk of “enhancing the in-store experience” tends to go hand-in-hand with promoting the growth of beacons at retail location, which over the past year appear to be installed at most major stores. But a poll of 1,085 US consumers this summer by First Insight found that 70 percent of retail shoppers have never heard of these Bluetooth-powered devices. (Read the release.)

For digital marketing professionals and brands focused on the concepts associated with omnichannel strategies, the Internet of Things, and online-to-offline advertising , the proximity communication tools seem ubiquitous. Within the past 12 months Macy’s activated Shopkick’s beacons in 4,000 of its stores last September and Lord & Taylor put Swirl’s beacons in all 50 if its stores ahead of Black Friday 2014.

The most recent embrace of beacons came from Target, which is currently connecting Apple’s iBeacon system to its branded iPhone app at 50 of its 1,800 US outlets, with Google Android compatibility and a wider store rollout to come over the next few months.

Aside from Google’s launch of its iBeacon rival with Eddystone last month, Facebook has been working since December on aligning its Place Tips app-based check-in feature with beacons for small businesses and outdoor festivals, such as at last week’s Lollapalooza event.

So if beacons are being embraced so widely by so many large players, wouldn’t it stand to reason that consumers would have taken notice and either expressed interest in turning on — or off — their smartphones’ Bluetooth receiver in response?

Not necessarily, according to our informal survey of beacon experts, who were asked:

Does it matter that 70 percent of consumers have no knowledge of beacon technology:

Estimote's Steve Cheney
Estimote’s Steve Cheney

— Steve Cheney, co-founder and SVP of business and operations at Estimote: Short answer – No.

Just as people don’t care that Uber is based on GPS and ignore the underlying tech (they care that the car comes to their house in 5 minutes), people also won’t care that beacons power new contextual experiences. Will a small subset of tech people? Sure? But the masses don’t need to care.

Overall we don’t think the visual nature of the beacon will increase consumers doing something on mobile. Sure there could be some visual cue vis-à-vis a beacon that you can interact with an object by opening your phone, – e.g. Google Eddystone could use Chrome to read a broadcasted URL and perhaps benefit from increased conversion *if* the consumer noticed a beacon on the wall. But the merchant could also just put up a sign that tells you to open your phone etc.

The industry is all focused on the beacons today because though fairly small, they’re a new tech device, and noticeable etc. But in the future they’ll be even smaller and will sort of drift off into the background… Most of the largest retailers / enterprises we work with put them in non-visible places (e.g. behind the Point-of-Sale, on the top rack of an endcap, etc).

At the end of the day, the smartest retailers, like Target, are focused on “what is the consumer value?” And the opt-in for Target’s location services in their newest app doesn’t even mention the word “beacon”; instead it just talks about the consumer value to enabling location services in the store.

New Location Essential's Stephen Statler
New Location Essential’s Stephen Statler

Stephen Statler, formerly head of Qualcomm Retail Solutions’ Strategy and Solutions Management groups and currently principal consultant at Statler Consulting:I would say that in most cases the public shouldn’t have to know what an iBeacon is. This is because it’s that app that is usually driving the interaction.

Take the original Apple Store app: you get welcomed when you enter the store, you don’t know how or why it happens.

If I am a blind person and I’m getting turn by turn directions through the airport from the BlindSquare app, I am probably unaware when GPS is no longer used and when a beacon is being referenced.

Where this changes is with the PhysicalWeb. There, people need to take the initiative to browse for beacons or at least for URLs being broadcast by appliances or other physical objects.

Unacast's Thomas Walle
Unacast’s Thomas Walle

— Thomas Walle, co-founder and CEO of Unacast and head of Proxbook: It’s hard to say if the [70 percent] number is too high or too low. But looking at the results, I believe the finding is actually positive. “Wow, 30 percent of the 1,000 consumers surveyed know what a beacon is.”

Most of the beacon projects are still in pilot, and with few customers getting the beacon experience. So, with 30 percent knowing about beacons, I see that as a result of the wide media coverage about the future of retail and new technologies emerging to create a better end user experience.

— Dave Heinzinger, Senior Director, Communications, inMarket: “People don’t care what brand of server delivers their favorite website — just that the site works.

We use a combination of beacons, geofencing and other proximity tools to deliver in-store engagements to 36MM app users per month, in every major U.S. retailer.

Our results show that consumers are over 16x more likely to use apps in the store, and over 6x more likely to retain location-aware apps that add value to their in-store experience. People care about relevant information that helps them shop, and aren’t worried about the technical details behind how it’s delivered.

GPShopper's Bill Siwicki
GPShopper’s Bill Siwicki

— Bill Siwicki, VP of Mobile Strategy and Research at GPShopper: 70 percent of consumers can’t explain electricity, either. A beacon is a piece of infrastructure that consumers never see.

The only thing a consumer should know is whether they can receive alerts, coupons and more when they’re in a store.

The real question is, “How many consumers know what location-based alerts are?”

The answer?

Too few, because retailers are not offering them, waiting inexplicably as increasingly mobile customers look to be wowed by businesses on their smartphones.

Retailers need to jump in and experiment, and make sure to promote location-based alerts with physical or digital signs in-store. Then location-based alerts will soar — and 70 percent of consumers still won’t know what beacons are.