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Why Beacons are the Key to Digital Marketing

As digital location markers, beacons are set to revolutionize marketing. This is a completely new experience for the customer and an opportunity for marketing managers.

As part of a marketing strategy, beacon technology is designed to introduce the customer to location-based services. For marketing managers, this opens up completely new possibilities.

So what are beacons?

The first beacon hardware came to market in 2013. These were low-power Bluetooth devices installed in stores and designed to send push messages to potential customers’ cellphones as they passed, alerting them to the latest offers and sending them coupons.

However, it was tough at the start and many retail pilot projects soon failed. There were too many elements that had to be come together: Customers’ smartphones needed the right app, Bluetooth needed to be active, location services enabled, and push notifications allowed. Even if all this was the case, the offerings were insufficiently personalized and not tailored to these potential customers’ needs. In Germany’s case, there are also massive problems with data protection.

Since then, marketing managers have learned their lessons from these negative experiences and are ready for a fresh start. According to a study conducted by market researchers from Gartner, only six percent of marketing decision-makers surveyed had active beacon installations, but 22 percent envisaged pilot projects and 32 percent saw it as an area for investment in the near future.

New beacon projects

With these new projects, the focus is no longer on direct customer approach. Instead, today beacons are used more to analyze customer behavior. Beacon technology allows the collection of data about products that customers have purchased. Customers’ movements within a store can also be tracked.

Marketing managers thus receive valuable information that they can use to better place and select their products.

Personalized customer approach

This is not to say that the direct approach is completely dead. Marketing managers must, however, be focused: The address should be limited to holders of loyalty cards who have expressly agreed to it. Customer confidence is crucial.

If customers are really interested in offers, they will appreciate digital beacons. This is confirmed by current market data: According to a survey conducted by the market research company KantarTNS, 34 percent of consumers in Germany are interested in personalized offers. This number is lower than in all its European neighbors, but shows that the target group exists.

Application scenarios for beacons

One user of beacon technology is Frankfurt Airport. Passengers receive information on how to get to the right terminal, are made aware of departure times and receive the latest offers.

The Fraunhofer Institute uses beacons in its HandelKompetent project to identify learning facilities within retail companies.

Source cover picture: MarsYu / iStock