Six degrees of Kevin Beacon
A lot has been said recently about beacon technology and how it can improve the retail shopping experience. Adam Silverman at Forrester recently suggested that retailers were gripped by ‘beacon fever’.
Getting the balance of location-based targeting right
As marketers around the world race to experiment with beacons they will have to be careful not to turn off the very customers they are trying to attract. And with all these new opportunities for unique customer engagements, it would be easy to forget one of the most important uses for the technology. The good news is beacons work when done properly; use of beacons can increase in-store app usage by over 16x, making users over 6x more likely to keep an app installed on their phone.
Create better, more personal, customer experiences
Right now, retailers are focusing on using beacons to personalize the shopping experience for their customers through human and digital touch points that include: front-line staff, smartphones, digital signage and kiosks. We help lots of our customers to do this. It isn’t hard to imagine the benefit of an app that alerts staff every time a high value customer strolls in, or the convenience of an app that automatically orders a customer’s favorite coffee when they enter a café.
There really is no shortage of examples and in reality different retailers will benefit both themselves and their customers by using beacon technology in different ways. However, there is one particular way the technology can be used to benefit all retailers; unfortunately it’s in danger of drowning among a plethora of push notifications.
Understand customer value through live data
Remember, the whole point of customer engagement is to improve the lifetime value of your customers by changing their behavior in some way. Usually that means getting them in to store more often, or if you’re a fashion retailer then maybe you want them to come in at different times of the year. For QSRs, getting customers in at different times of the week or day increases their lifetime value. But how do you know if that new behavior is actually being sustained at an individual customer level? Nowadays, you use beacons to prove it.
It is essential that marketers can prove the value of their 1:1 customer engagement programs. With all the time and effort that goes into it, customer engagement has to pay dividends, usually by improving the lifetime value of customers. The problem is that until now it has been really hard for retailers to prove that what they spend on customer comms is actually changing customer behavior in the long run.
Today the most mobile savvy retailers are experimenting with how beacon technology can be used to measure and understand customer behavior at an individual level. More specifically they are using it to assess the impact of targeted messages on peoples long-term behavior and linking it back to sales.
Measure and influence behavior change
Lots of retailers are experimenting with beacon technology to improve customer experience but only some of them are using the technology to measure behavior change. We support the strategic goals of our clients by reporting when individual customers come within range of their in-store beacons. This data, which customers volunteer in exchange for some perceived value, can be used in a number of ways; primarily we use it to understand the value of individual customers based on when, where and how frequently they visit our retailers stores.
We can, for example, tell QSRs which of their customers visit at different parts of the day or week. Then we can target breakfast specials to customers who come for breakfast less than 5% of the time they visit a restaurant. We can see which customers redeem our vouchers and then we can use beacons to see how their behavior changes compared to the control group that didn’t redeem our vouchers.
After a few months we could, for example, report that people who redeemedour breakfast specials now come for breakfast 15% of the time while people who didn’t, still come just 5% of the time. Beacons, it turns out, are very good at proving the effectiveness of your marketing spend.
With beacon technology, a QSR could take this understanding even deeper. Data from in store beacons can be used to calculate how long people stayin store and where they spend most of their time. Dwell time data canhelp QSRs to identify which customers prefer dine in, take away or drivethru.
You don’t want to run an expensive promotion that gives away margin to absolutely everyone including people that would have made a purchase from one of your stores at that time anyway. That’s why it is so important, when considering mobile marketing, to use a platform that not only gives you the ability to send time and location based promotions but the ability to precisely target those promotions and measure how effectively they increase the lifetime value of the customers they touch. Once you have all this in place you have a truly powerful mobile marketing solution.