Beacon solutions require a lean and agile approach

Posted by Ed Anderson on Dec 31, 2014 11:27:00 AM
Ed Anderson
There is an often-heard narrative that the journey to improve the shopping experience necessitates an intrusion on your customer's privacy. Assessing the validity of this fear requires an understanding of how the combination of a retailer's app and beacons work. The chart below depicts how beacons work and can be found here
How_Beacons_Work
The authors of "A Guide to Beacon Technologies" conclude: "Beacons are sometimes misunderstood as instruments of “surveillance,” capable of tracking smartphone owners’ movements without their awareness. This is incorrect." 
 

Defeating Surveillance and Intrusion 

 

Your customer's protection is based on a three part opt-in process:
1) The shopper has downloaded either the retailer's app or a third party app that can receive signals from Bluetooth Low Energy sensors (beacons)
2) The shopper has turned on Bluetooth (which is installed on at least 90% of smart phones today...and smartphones account for almost 75% of mobile phones in North America).
3) The shopper has enabled notifications from the app they've downloaded to their phone.
Not to dismiss real concerns over unwanted surveillance or invasion of privacy, because, no doubt, there will be abusers of beacon solutions when the consumer doesn't opt out by one of the methods above. If a shopper takes these steps in the opt-in process, personal information will not be tracked.

Obstacles to a Better Shopping Experience

 

 

Retailers want to avoid privacy concerns, but the imperative is to improve the shopping experience. What are the obstacles to adoption of beacons and apps to enrich the shopping experience? We have had a fear of technology since the invention of the printing press. And, consequently there is a substantial body of thought on How to Overcome Fear of Technology.

 

Gartner has even built a practice around fear of technology, and they do a "Hype Cycle" for each new emerging technology. You can find 30 new technologies mapped by their stage in the Hype Cycle here

Some of the time required to go thru the Hype Cycle may be blamed on fear of technology. No doubt. But part of the problem may be the consumers' perception that there just isn't enough value in the new technology to merit embracing it. The time to accept new technologies (as reflected in media spend) such as TV, Cable, the Internet, and smart phones has declined:
PWC_internet_advertising_report_2013
But there is still a risk in adopting new technology and this risk can be mitigated. 

Drucker on Marketing and Innovation

 

Peter Drucker, who some assert invented modern management principles said:
"There is only one valid definition of business purpose: to create a customer....therefore, any business enterprise has two and only two basic functions: marketing and innovation." 
Really listening to retailer guests regarding issues they will have with new technology such as beacons to improve the shopping experience is required, but is it enough? Drucker on market orientation:
"Selling and marketing are antithetical rather than synonymous or even complementary. There will always be, one can assume, a need for some selling. but the aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits her and sells itself. Ideally, marketing should result in a customer that's ready to buy."

O’Donovan and Flower suggest that we “abandon our focus on predictions and shift into rapid prototyping and experimentation so that we learn quickly about what actually works.”

 

Drucker couldn’t have agreed more. “Everything improved or new needs to be tested on a small scale; that is, it needs to be piloted,” he wrote, adding that the upside from starting small is huge: “If the pilot test is successful—if it finds the problems nobody anticipated but also finds the opportunities that nobody anticipated, whether in terms of design, of market, of service—the risk of change” is minimal and manageable."

Retailers should ask solution providers what their cadence is of new product revisions... to screen for those who use a lean and agile approach in product marketing and development. This will be pivotal in creating the right user experience and the right feature set in the right amount of time.
 

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