Striking Data Gold: Apple iBeacons

Oct. 22, 2014

Shopper near iBeacon

In today’s marketing landscape, data is more valuable than ever. It’s used to fuel programmatic campaigns, influence multi-million dollar television plans, and is the sole indicator of whether an organization’s marketing efforts have been successful. But when it comes to B2C businesses, marketers are operating with an incomplete data set. Fortunately, Apple’s latest iOS 8 release is a big step towards filling out the rest of that consumer data set. Below is part one of our two-part series on Apple iBeacons and Apple Pay.

When Apple held its annual new iPhone reveal last month, much of the reaction from the blogosphere focused on the new hardware. The release of the iWatch and the iPhone’s larger size options and increased pixel count were covered at length, but less was said about what really matters to marketers: the updates made to iBeacons.

The iBeacon is Apple’s version of the quickly-growing, Bluetooth low-energy (BLE) proximity-aware transmitting devices, beacons. For example, these small and inexpensive transmitters can be used by retailers, airlines, hotels and other brands with brick-and-mortar locations to communicate with consumers’ smartphones.

Here’s how it works: a retailer will place these transmitters in strategic spots around their store. These transmitters emit a low energy Bluetooth signal, and if a consumer’s device has a beacon-enabled app installed, that signal can issue an information push notification, issue an alert for a special offer, or request and collect data from the app.

Though the iBeacon technology has actually been supported since the release of iOS 7, the recently announced updates have given it more legitimacy and retailers more confidence.

Here are the new iOS 8 iBeacon updates:

– Enhanced Privacy – In the last year or so, some retailers have begun using some creative means to collect in-store data. These retailers have been collecting users’ MAC addresses (unique device identifiers communicated while networking with other computer and servers) when a shopper tries to connect with a store’s Wi-Fi network. After this MAC address is collected, a retailer can then monitor whether a specific shopper returns to the store, and based on that data, better market to that shopper.

But now, iOS 8 randomizes the MAC address each time a device attempts to connect with a Wi-Fi network. This update ensures a shopper’s anonymity, and prevents stores from collecting data from a user who has not opted in.

This update will ensure that retailers use iBeacons, since the MAC address alternative has effectively been eliminated (at least for iOS 8 devices). Now, if a retailer wants to collect in-store engagement data, they will need to install iBeacon code into their mobile apps, so that code can listen out for the iBeacon BLE signals. The benefit to the consumer is enhanced privacy, which in-turn gives confidence to shoppers and merchants alike to adopt the more secure iBeacon technology.

– Rumored Additional UI Features – Though it wasn’t mentioned in the release of iOS 8, there are reports of User Interface enhancements allowing for less-obtrusive beacon-initiated iPhone notifications that appear on the lock-screen. In a few test locations, Apple Insider, states that a Shopping Cart icon appears in the bottom left-hand corner of the lock-screen. It is thought that, when engaged, the icon will direct a user to either the merchant’s app, or to the Apple Store to prompt an app download. This passive notification approach should encourage iPhone owners to opt-in to the Location-Tracking Services in iOS 8 as well as keep their Bluetooth capabilities turned on, which currently, a lot of users turn off as a means to save battery life (an issue which, Forbes reports, Apple is creatively addressing). Again, the hope from Apple is that a less intrusive iBeacon-triggered notification will increase the iBeacon audience, providing more scale and incentive for brick-and-mortar businesses to adopt iBeacons.

For marketers, these enhancements demonstrate Apple’s commitment to the iBeacon product offering and that it’s safe to assume that there will be significant adoption from both consumers and advertisers in the coming years. With this in mind, it’s time for marketers to start thinking about how they will best use the technology. For starters, let’s take a look at the two most likely uses for the technology:

  • Actionable Messaging – When marketers discuss beacons, the scenario that first comes to mind usually centers around pushing informational and/or incentivised messaging to consumers in or around a brick-and-mortar store. Conceptually, this case makes a lot of sense to marketers, since they are already pushing that messaging to shoppers browsing their online stores. However, with this scenario, it is important to ask: Marketers spend millions of dollars to drive shoppers through their doors so those shoppers can engage and experience their products, and now, they are creating a strategy that takes the shopper’s eyes off the merchandise and onto their phone? This concern challenges the idea that in-store mobile messaging can be structured like online messaging. It cannot, because, for example, a customer walking through a store’s footwear aisles may be enroute to buy tools and will find footwear-related offers irrelevant.  It will take time for advertisers to create best practices around when, how, and what to message in-store shoppers. So, it is important for marketers to maintain a testing mindset when first utilizing the new technology.
  • Observability – The more overlooked of the two beacon strategies, observability, is simply a word that describes the insight-gathering capabilities of beacon technology. Similar to how web analytics is utilized, data generated through beacon technology has the potential to provide deep insight into in-store activity and engagement, such as how different store layouts affect the path to purchase, or insight into the most-visited sections of the store. Additionally, beacons–and specifically iBeacons, given the pervasiveness of iOS–provide marketers with the missing data needed to assemble a complete view of a shopper’s engagement in-store and ultimately across channels.

As the adoption of iBeacons and Apple Pay (More on this in Part 2) increases, an advertiser’s Universal View of their consumers will slowly come into refined focus. Scalable access to this data is a game changer for those advertisers who have the means of stitching together shopper profile IDs across channels, which is a tremendous undertaking in and of itself.

Leading advertisers have already started preparing for this fast-approaching wave of consumer data. They know that their invested relationships with sophisticated CRM, mobile app, and browser-based technologies will only be as strong as their ability to communicate real-time data and consumer insights between them. Utilizing the data generated through the adoption of iBeacons will present one of the of the biggest obstacles, and opportunities, that today’s marketers have ever seen: never has it been more important for advertisers to coordinate their marketing technologies.

Signal’s Open Data Platform is designed to put advertisers in the driver’s seat of the data they’d like to collect, merge, and share. We can help you plan, build, and prepare for the consumer data that is available now and in the future, so that your technologies work better together.

To learn more about how Signal Fuse and the Open Data Platform can help you build your data network, click here to request a demo.