iBeacon and the Evolution of Retail
Retail has evolved dramatically in the past 100 years. Out of the local corner store in the early 1900’s grew innovations like the self-service model and the idea of the “Department Store”, fueled by the rise of standardized products, refrigeration, and the shopping cart. 1940 to 1970 saw the birth of Strip Malls and Mass Retailers, driven by the innovation of the car and resulting suburban expansion. Value Players, Club Stores, and Category Killers arrived in the 1980’s and 90’s – spurred along by commoditized products, global megabrands, and a price conscious consumer. Then, in the late 1990’s and 2000’s, we saw the internet explosion and a seismic shift towards e-commerce. Throughout this history, retailers have risen to success and suffered in failure, struggling to stay ahead of the ever tumultuous waves of change.
Waves of Change
Looking at retail’s history, it’s easy to see that technological advancement has and will be an important driver of the sector’s evolution. Much like in biological evolution, where environmental constraints shape biological traits, the profile of the “Successful Retailer of Tomorrow” will be shaped heavily by current advancements in technology and resulting changes in consumer behavior. Throughout retail’s history, we’ve seen big names innovate, succeed, and whither into irrelevance as changes in technology and consumer behavior pass them by. Retailers who adapt and evolve survive. Those who stagnate are destined to lose.
Retailers are a stubborn bunch, and often change only comes once it’s too late. Success in any business venture can be likened to surfing. You have to start paddling before you see the wave in order to reap the rewards of the ride. Those who begin paddling only after the wave has crested are too late – they’re destined to miss out as the innovators and the avant-garde steal the future.
The Future: iBeacon and the Internet of (Every)Thing(s)
We’re on the brink of a major shift in how consumer’s use and interface with technology on a daily basis. Over the past few decades, technology has been shrinking in size and increasing in speed and power at exponential rates. We’ve reached a tipping point in recent years, with Mobile Computing and Wireless Tech providing an exciting and widespread platform for the internet’s escape from the desktop to the pocket. Most recently, advancements in Bluetooth Low Energy (BLE) and Apple’s iBeacon protocol have set the stage for an even more exciting possibility – a connected world. Not just people – everything. If you’ve heard about the Internet of Everything or the Internet of Things, two terms soaked in generality – this is what all the excitement is about. The online/off-line division is disintegrating around us, creating enormous potential for technology such as iBeacon to lubricate and enhance real-world experiences for consumers and businesses. This is an exciting idea, and one far too broad to cover within the scope of a blog post. Today, I’d like to go over a few quick points retailers might consider to future-proof themselves and succeed in the upcoming iBeacon revolution.
Context is King
iBeacon gives retailers the opportunity to engage a consumer precisely when the time is right. Engaging a shopper when they’re on the couch watching TV is infinitely less effective than engaging them in-store, ready to shop. iBeacons are important because they provide a new channel through which to understand shopper behavior and deliver relevant messaging. iBeacon gives retailers the opportunity to build a dynamic digital layer atop their traditionally static and unresponsive experience. This should increase consumer touch points and as a result, loyalty.
But Content is also King!
Throughout history, retailers haven’t been able to provide much real content outside of their limited physical constraints. Paper circulars, shelf displays, and yesterday’s coupons only go so far to add value and prevent e-commerce cannibalism. iBeacon allows retailers to become media-focused, providing their patrons with value-add content that will increase customer engagement and basket size. Imagine delivering a custom recipe or shopping list map to a customer based on what’s in their digital ‘basket’. iBeacon gives stores the ability to have a personal shopping concierge in every patron’s pocket.
Sure, retailers could restrict in-store iBeacon access to strictly their own Branded Apps, but that would drastically limit reach. For example, Target’s Cartwheel App has about 500K downloads. Compared to the greater potential audience of every smartphone in the United States, this is nothing. Not every consumer walking into a store is going to have a Retailer’s Branded App. Think of how many stores you visit – keeping a dedicated app for each one is unrealistic. A suggested approach for Retailers would be to embrace an iBeacon Platform solution. By embracing openness and allowing other apps into their network, a retailer could provide immeasurable value to an even larger percentage of patrons.