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Location Marketing 2.0 Arrives: The Impact of iBeacon

by: Dave Walters (@_DaveWalters)
16 January 2014

Knowing where your customers are physically is an immensely powerful part of delivering the right message at the right time. In recent years, forward-thinking marketers have communicated with customers based on their check-in behaviors via Foursquare and Facebook. More recently, geofence technology has enabled marketers to send opted-in customers a message when they cross a virtual fence around a physical store location.

Powerful stuff, but it’s about to get even cooler: Apple’s announcement of the iBeacon functionality as part of its iOS7 operating system is a game-changer for how businesses will conduct location-based marketing in the future. Think of iBeacon as a form of micro-location geofencing that makes it much easier for retailers to use a person’s exact location within a store to deliver targeted, relevant content.

Here’s how it works: A customer with an iPhone 4S or later (or Android, see below) who’s downloaded your app walks into your store. The iBeacon functionality in their phone – powered by Bluetooth Low Energy so it only consumes a small amount of battery power – exchanges data with beacons in your store. Your system has been configured to send push notifications to customers who meet certain criteria (in this case, downloaded your app and standing in a certain location). So at the exact moment the customer strolls into Aisle 12, they receive a push notification on the phone with offers or content related to where they’re standing.

Taking the concept a step further, you could use any demographic and behavioral data you have about that customer to customize the content you send based on age, gender, purchase history, online shopping cart, products viewed online and hundreds of other variables.  The ramifications for the in-store shopping experience are pretty exciting, as I discuss in this recent video: 

Not only do 95 percent of iPhone users already have iBeacon, but there are both technologies and companies popping up that enable this for Android – with new Droids likely to have additional capabilities baked in. Just as importantly, the ease with which it works for customers is likely to normalize the concept for them, meaning they’ll grow to expect and anticipate that their favorite brands will communicate with them in this fashion when they enter a store.

Speaking of which, if you’re looking for an elegant way to integrate this type of location-based marketing in 2014, your VIP customers are a logical place to start, since they represent a known customer set that’s already engaged with your marketing messages. So for example, the next time a VIP who recently purchased a pair of running shoes enters the store, you could send that customer a message that says, “Hi Vanessa, welcome back to the store today. Check out our running accessories on aisle 12, 10% off today exclusively for you. If you have any questions, please check in with our VIP rep Dave at our customer service center, located in the front-right corner of the store.”

The possibilities are endless for marketers. You could use iBeacon to serve up customized coupons, send sales alerts based on real-time external data (such as weather changes), display personalized product information and videos, curate shopping lists based on past purchases, and drive email opt-ins. Moving beyond mobile, you could use iBeacon activity to trigger communications in other channels.

If you’re interested in implementing this type of location marketing in 2014, here are four tactics to consider:

1) Plan which segments of customers you want to send location-related content. Develop a plan for what content will enhance their in-store experience and how you’ll introduce the program to them.

2) Prep your data to take advantage of Location 2.0. This might mean integrating offline purchasers into your database, so if someone shows up at retail, and they aren’t part of your email list, you know that they’re a purchaser.

3) Work with in-store personnel to put the correct technology in place and train retail salespeople. As with any in-store technology, the reps in the store need to understand the new processes if you’re going to truly deliver on the technology’s promise.

4) Complement your iBeacon-driven push messaging with email communications. Depending on the person, exiting your store might trigger an email promoting products in the areas they browsed, upsell offers for items related to what they purchased, or a summary of their rewards benefits based on their latest store visit.

No matter how you slice it, the bottom line is that iBeacon technology is poised to become the default layer of communications between brands and users at the location level as we move into 2014 and 2015. The most successful marketers will be those who develop smart ways to make the in-store shopping experience more rewarding for their customers.

Related Resources:

1) Blog: “Behavioral Email Done Right: Big Ups to Foursquare and Sephora

2) White Paper: “The Ultimate Guide to Location-Based Marketing with Foursquare and Facebook

3) Blog: “5 Cross-Channel Use Cases for Universal Behaviors” 


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