Why should you start a beacon pilot today? Because beacons are helping companies increase customer engagement and conversions. That’s the simple answer.
The numbers prove it, too, as you can read about in Part 1 of this series, which covered, in part, efforts at Hudson’s Bay Company (Lord & Taylor) to embrace the location technology.
At the recent DMA 2014 conference, Ryan Craver, HBC’s senior vice president of strategy, reported that beacons drove higher customer engagement in its early pilots. Metrics resulting from the measurement of five major apps with very distinct audiences in 10 stores revealed that beacons drove two to three times the open and conversion rates of typical banner campaigns (see slide 54). Today the organization is continuing to evaluate additional beacon use cases in the areas of social, checkout, and more.
In Gigaom’s October 2014 report, “Mobile Marketing: Four Emerging Trends,” Colin Gibbs, senior analyst specializing in mobile coverage, noted: “The landscape is likely to change substantially over the next 12 to 24 months as it evolves and consolidates, so many small to medium-sized merchants would be wise to monitor the market closely before investing in the hardware, signage, app development, and personnel training necessary for any BLE-based campaign. But retail chains and other major merchants should consider experimenting with the technology as quickly as possible.”
For the sake of this article, then, I am speaking mostly to retail chains and other major merchants with the resources to take on this challenge. These early adopters are setting the pace, determining the rhythms of ideal communications, and testing out early use cases. We can learn from their tests and challenges in deployment. However, smaller mobile marketing teams shouldn’t sit on the sidelines forever.
Here’s how to get in the game as soon as possible.
1. Make sure your entire staff is beacon-savvy: My friend recently took his iPhone 6 into a major retailer that was supposedly Apple Pay-ready. When he went to checkout, he noticed an Apple Pay sign, took out his phone and said, “I’d like to pay with my iPhone.” The sales associate stared at him blankly. He continued, “You know, Apple Pay.” He pointed to the sign with the Apple logo. Same blank stare. So he pulled out his trusted debit card.
My point: If you’re going to roll out a new technology pilot, your entire staff will need extensive training in order to understand it. It doesn’t matter whether the chief marketing officer and mobile marketing team understand beacons. If your frontline sales team doesn’t get it, then you’re doomed from the outset.
Forrester, in “The Impact of Beacons in Retail,” suggested that sales associates will need retraining in order to address the wants and needs of the new, beacon-ready customers: “Associates will need to be retrained to first consider the explicit preference of customers before approaching them in-aisle and suggesting upsell and cross-sell items.” It’s no longer about approaching a customer and blindly guessing his interests. The location-savvy in-store associate of the future will perhaps be trained in analyzing customer preferences and behaviors on the customer’s tablet device, and then approaching the customer with targeted upsells, cross-sells, and general customer service.
2. Exercise restraint in customer communications: In terms of communication, less is more, especially at the beginning. Don’t overwhelm your beacon-friendly customers by overcommunicating with them. Exercise restraint. “Retailers must be mindful of the consumer when leveraging proximity marketing strategies, and must err on the side of restraint when delivering marketing messages,” Gigaom reminds us.
Remember: You don’t know how much customers want to hear from you at this point. For example, Macy’s, with a deployment of 4,000 beacons across the U.S., said it will be learning as it goes “in determining the ideal cadence for delivering offers and other information to customers’ phones.” It expects “that process will be similar to the early days of email promotions,” trying to strike a balance between overloading customers and ignoring them.
3. Provide customers with value and ‘wow’: Forrester recommends that mobile marketing teams focus on value: “Think beyond offers based on location. Enable associates with location context so that they can better serve customers in their moments of need. Customers are providing value to retailers by providing location information. In turn, retailers must provide value that enhances the customer experience, including improved services such as enabling customers to use their phones as keys to open dressing rooms, or improved convenience, such as eliminating the need to wait in line to pick up an order.”
Walgreens’ 10-store pilot provides a great example of an organization that is attempting to provide value to its customers through beacons. Beacons are currently being piloted in 10 Duane Reade stores, owned by Walgreens, in New York City. Mobile Commerce Daily reports, “The decision to launch the iBeacon pilot is based on findings from Walgreens that the average in-store, online, and mobile shopper spends six times more than the average store-only shopper.”
As we discussed in Part 2 of this series, good iBeacon strategy includes both push and pull marketing strategies. Walgreens is launching the pilot to complement its existing in-store mobile coupon program and app. The company has set up geofences that are triggered by beacons once a customer comes within range of a Walgreens store. This is ideally designed to “help speed up the process of accessing the app.” Once the customers are in-app and in-store, the beacons can work their magic. And, of course, frontline staff will be trained to respond to any customer questions or concerns (see point No. 1).
4. Build in measurement from the outset: My education included many classes in engineering and statistics, so I will continue to beat this drum: It is a best practice to build in measurement at the start of any new mobile marketing strategy. The use of data and analytics in this era of digital marketing is critical to your success. Before you begin testing beacons in your brick-and-mortar stores, build in measurement. Then you will be able to leverage data to answer: What use cases convert customers? What messages result in the desired response? What works and what doesn’t?
Adobe’s mobile consulting team recently posted a blog to discuss best practices in beacon measurement. Using data collected from apps that are triggered by beacons, marketers should focus on measuring conversions from “offers shown” to “offers touched” to “offers redeemed” within their stores. (Note: Adobe is CMO.com’s parent company.) In addition, if the in-store sales team understands traffic patterns of consumers, they can think through ways to optimize store layout based on beacon pathing and dwell times. This is where data-driven marketing combined with creative thinking, problem solving, hypotheses, and testing will continue to shape in-store strategies.
A Call To Action For Mobile Marketers
Forrester, in “The Impact of Beacons in Retail,” makes a somewhat challenging statement to early innovators and adopters of the technology: “Leaders have yet to craft use cases that create engagement or convenience that will better serve their customers in their mobile moments.”
Mobile marketing teams, let’s take that as a call to action. Let’s assemble our thoughts and our teams, and begin to pilot our own unique and innovative use cases that make our organizations memorable and amazing to customers.