Beacon marketing is a form of real-time location-based marketing. As the name suggests, it harnesses the technology involved in a piece of hardware called a beacon, which is lightweight and small enough to be attached to a counter or wall. These beacons then use Bluetooth technology to transmit messages to nearby smartphones or tablets.

The technology is an alternative to GPS, which sometimes suffers from signal problems when trying to reach customers indoors.

At the moment, customers have to download apps to access the data transmitted by the beacons, but this is just good manners on behalf of the businesses who are championing the technology.

Beacon marketing is also an alternative to proximity marketing, which has utilized Bluetooth technology since circa 2006. Proximity marketing worked in a similar way to beacon, except for the fact that it required the user to accept a company’s Bluetooth pairing request to share their deals and information with them. With beacon marketing, the user has already pre-approved the reception of the deals and info by downloading an app.

How is beacon technology put into practice?

Beacon marketing has a range of applications. In shops, it can be used to send customers flash deals as they walk through a particular department. In clothing stores beacons can be attached to mannequins and be programmed to tell passing shoppers how much the item of clothing on the mannequin costs and where the garments can be found in store.

In the future, the technology could even be used to speed up the checkout process with a contactless payment system.

Who’s using it?

American companies are at the forefront of beacon implementation. Across the pond, Macy’s, Timberland and Clark are all testing the technology. Over in the UK, Cad bury have expressed an intention to start using beacons to drive impulse sales. Plus, there’s a House of Fraser store in Aberdeen which is about to add beacons to its mannequins to give customers product information.

What are the objections?

Privacy campaigners are uncomfortable about the widespread adoption of beacon technology. They worry that companies will be able to access more personal data about customers than the customers would like. For example, they worry that businesses will store records of each customer’s shopping habits with regard to both location, spend and frequency. As always with matters of data, they worry that the collection and storage of personal data cannot be policed properly.

When can you get on the bandwagon?

It probably won’t come as surprise to discover that Apple are leading the way when it comes to making beacon technology available to the masses. They have recently created a product called iBeacon, which allows businesses to track the exact location of customers inside a store, as long as the customers enable Bluetooth and accepts the technology through an app or similar.

As a business, you’d need to develop an app or adapt your existing apps to be able to harness the beacon technology, but it is out there for the taking if you have the budget.

Many UK retailers are playing the waiting game when it comes to beacons. It won’t be long before Macy and Timberland in America produce reports on how successful their beacon marketing efforts have been. However, if it proves to be a success in the states, you can be sure that beacons will be flying onto the shelves and/or mannequins of businesses around the country pretty soon.