IT and Business Insights for SMB Solution Providers

Shopping Gets Personal with Proximity Marketing

The Internet of Things allow you to engage shoppers at the right place and right time with the right message. By James E. Gaskin

COKE OR PEPSI? While you ponder the refrigerated display of ice-cold soda, your smartphone dings with a notification that you’ve just received a Pepsi coupon. Big Brother? Nope, proximity marketing. Beacons and other IoT technologies now make it possible for businesses to direct relevant, timely information to customers based on their physical location within a store or other venue.

A subset of location marketing, which identifies customers in a general area like a mall, proximity marketing works on a personal level, according to Asif Khan, president of the Location Based Marketing Association (LBMA) in Toronto. “Proximity marketing takes over where GPS leaves off, at 3 meters or less, when the customer is close enough to reach out and touch the product,” he explains.

For instance, says Khan, “When the customer is walking to the Coke display, that’s when Pepsi can try and influence that purchase.”

While immediate sales is one goal of proximity marketing, gathering analytics is another. Wi-Fi can now triangulate people’s locations using two routers and software to track traffic patterns and flow. “If Walmart can prove to Colgate an endcap sees more traffic than expected, they can charge more to advertise there,” says Khan.

Getting Started

Chip Hysler, CEO and co-founder of Creative Marketing Solutions, in Hendersonville, Tenn., says proximity marketing requires three things: a beacon, a mobile device, and content. A store, for example, “already has the content,” says Hysler. The customer has the mobile phone, and beacons are where the IoT integrator comes in. A Bluetooth Low Energy (BLE) beacon can send a URL to phones directly; push notifications and other interactions require an internet link.

“Beacons really got started about seven years ago when Apple released their iBeacon,” says Hysler. Then in 2015, Google introduced Eddystone, an open beacon format that can be detected by both Android and iOS devices. Eddystone and iBeacon are still two of the most popular beacon formats. Most are available on GitHub.

Khan suggests looking beyond the traditional beacon, however. “Integrators should talk to companies like Phillips about their lighting solutions with beacons built into the lights,” he says. If you’re updating a customer to smart lighting, adding the beacons can kickstart a proximity marketing project.

Getting started with proximity marketing technology isn’t difficult, says Hysler. “There are a number of vendors, and you can get as technical as you want, but you don’t have to. The different vendors have different back ends that you can customize, and some allow white labeling.” New York-based MobStac Inc. (aka Beaconstac) and Atlantis Dev Inc., and Belgium-based Bleesk are among many vendors in the field offering service suites and reseller programs.

Before selling a proximity marketing solution, however, you need to teach potential customers about how it works, says Khan. “I spend a lot of my time trying to educate advertising agencies and others about the value of location-based marketing. To help, we have many free resources on our site [thelbma.com], including our podcast with over 100,000 subscribers.”

IoT integrators may choose to sell the beacons or lease and maintain them, which is what Hysler’s customers prefer. “Some clients barely have time to update their Facebook page, so we monitor the beacons and replace batteries when necessary,” he says.

Hysler also suggests using the same tools you employ for proximity marketing for other projects as well. “We’re helping a local hospital track equipment using beacons,” he says. “For an assisted-living memory facility, we turned proximity marketing around and put beacons on the patients to track them as they moved around the building.”

As that story illustrates, proximity marketing isn’t just for the Cokes and Pepsis of the world. LBMA has members, both vendors and brands, in 20 countries. “Proximity marketing is used by the Global 50 all the way down to Joe’s Corner Store,” Khan says.

About the Author

James E. Gaskin's picture

JAMES E. GASKIN is a ChannelPro contributing editor and former reseller based in Dallas.

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