Are Bluetooth Beacons a Scalable Option for Mobile Marketers?

Beacon marketing

Earlier this year, Forbes called 2015 “The Year of The Mobile Beacon,” and that may be the case. Adoption of beacon technology is on the rise and more businesses are using beacons to create location-based mobile marketing campaigns. But are beacons a valid solution for mobile marketing at scale?

First ─ a little “Beacon 101” crash course. A beacon is wireless sensor that uses Bluetooth Low Energy (BLE) ─  2.4GHz short-wavelength UHF radio waves ─ to transmit data that Bluetooth-enabled smartphones can detect. Retailers can install them in their store, on a wall or rack, and nearby Bluetooth-enabled mobile devices can detect these signals and pass the information ─ typically a few ID numbers ─ to apps on the device.

An app can use the ID numbers to find the exact beacon location, determine where the consumer is down to the aisle and serve up a highly-targeted message about products in that area. And with further implementation, they could also track any transactions made by the consumer.

Apple iBeacon and Android support for beacons

Apple iOS and Google Android both support Bluetooth beacons in their mobile operating systems ­─ Apple introduced the iBeacon protocol in 2013 and started supporting it with iOS 7. Google has not released a similar protocol or API, but it supports all Bluetooth devices following Android version 4.3. Android developers can make applications work with iBeacon hardware devices by using Apple’s protocol and API in their applications, or use the open AltBeacon standard.

Bluetooth beacons are not a scalable solution

While Bluetooth beacons hold a lot of potential for advertisers, they can’t put all their eggs in the “beacon” basket just yet. Current beacons have a very limited reach. They can only display promotional ads on a retailer’s mobile app ─ or an app that has access to the retailer’s beacons ─ when a consumer is at a retail location. But reaching consumers successfully in this way is dependent on each store location having beacons installed, and consumers with a Bluetooth enabled app listening for those beacons.

Solution: A centralized database

For Bluetooth beacons to become a viable solution for location-based advertising at scale, there must be an industry-wide effort to create a centralized database of all Bluetooth beacons that can be easily assessed by apps, and they can in turn provide location information to advertisers.

But retail chains are reluctant to share beacons locations, because they don’t want competitors accessing their beacons to serve competing ads in their stores. In order to make all parties comfortable with a centralized database, controls must be put in place to prevent “beacon pirating.”

There’s also the issue of chains wanting a portion of ad revenue for sharing the location of their beacons and allowing their signals to be used by other advertisers.

Bottom line

Until these challenges are solved, Bluetooth beacons won’t be a scalable option for most retail stores, leaving current technologies that use GPS, Wi-Fi, and cell phone towers the most effective, scalable solutions.






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