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4 Big Mistakes Retailers Make When Implementing Beacon Technology

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If you’ve been keeping abreast with the latest developments in retail technology then you’ve likely heard of beacons—those nifty devices that enable retailers to send customized notifications to shoppers while they’re inside a store.

Powered by Bluetooth Low Energy (BLE), beacons can communicate with other BLE-enabled gadgets, including smartphones and smartwatches. They also have the ability to recognize devices based on their location and previous interactions, enabling them to send relevant and location-specific messages to different devices.

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Needless to say, beacons are a big deal, especially in offline retail. They give brick-and-mortar stores data and personalization capabilities that were previously only available to online pure plays. They are also expected to directly influence over $4 billion worth of US retail sales in 2015, making beacon tech one of the most promising innovations to hit the industry.

That said, while retailers should certainly consider installing beacons in their stores, they shouldn’t implement the technology without thinking about the issues they can run into. Beacons can do wonders for offline retailers, but if the technology isn’t carried out correctly, it can do more harm than good.

The following paragraphs will talk about the common pitfalls that retailers fall into when rolling out beacon technology. Check them out below and make it a point to avoid them when you’re implementing your beacon strategy:

Mistake #1: Rolling out beacons without thorough planning and testing

With beacons being so new and promising, it can be tempting to forge ahead with the technology and implement it straight away. Don’t fall into this trap. Resist your “beacon happy” urges and take the time to plan and test how you’re going to deploy them in your stores.

Rather than rolling out the technology across your entire retail operation, opt to do it at one or two stores to start. Doing so will not only allow you to find (and crush) initial bugs and problems, but your tests will also surface initial shopper feedback that you can use to refine your efforts.

For instance, you may learn that customers get annoyed after they receive a certain number of offers or get targeted in a certain way. It’s best to pick up such lessons while testing the technology in one store, rather than finding them out after you’ve already deployed the campaigns in all your locations.

To help you make the most out of the testing phase, you may want to take a lean and agile approach in your trials. As Beacon Week founder Stefan Wolpers said in an interview with Vend, it’s best to “pick an average store as ‘your’ user testing lab and learn on the go.”

“It’s okay to start picking the low hanging fruits in the beginning (e.g. coupons), but try to figure out what your customers are really interested in,” he adds. “Iterate often: test new ideas while killing features that no customer is interested in.”

Mistake #2: Not training your staff properly

The success of beacons in your store doesn’t just rely on the gadgets themselves, but also on your staff, so see to it that all your associates are familiar with how the app works, not just from a retailer’s perspective, but also from the customer’s side.

Consider the experience of Retail Category Consultants (RCC), when they decided to see how beacon technology worked in two department store locations in Toronto. The RCC team blogged about their experience, and noted that one of the issues they encountered was insufficient staff knowledge.

“After asking a number of associates for help with the app, only one manager was able to answer our questions,” they wrote. That’s why RCC recommends that retailers invest more in beacon training. “Since beacons are new technology, retailers looking to deploy it in their stores must train all sales associates to understand how to use the app and how to address customer questions and concerns.”

Do note that your staff’s training shouldn’t end with the basic and technical details of beacon technology. You should also teach them how to make the most out it. Don’t just teach employees how beacons work, also train them how to interpret data, so they can glean insights and take action.

For example, most beacon solutions can notify your staff when an existing customer walks into the store. In this case, your associates should know how to pull up that shopper’s purchase history so they can approach them in a relevant way.

They should also be aware of the beacon messages that each shopper receives. For instance, if your in-store beacons already alerted the customer about a sale, then your staff probably shouldn’t mention the same thing, as they can come off as being too repetitive or pushy.

Mistake #3: Using beacons solely for sales purposes (and overlooking the other uses/applications of the technology)

The ability of beacons to send highly personalized offers is indeed powerful, but don’t forget that it’s not the only purpose of the technology. The uses of beacons can go beyond the realm of sales. You can also leverage the technology to engage shoppers and provide better customer service.

Consider the following:

1. Customer service

Rather than just using beacons to push offers, why not use them to serve customers better? That’s what Tesco did when it piloted the technology in its stores last year. The UK-based retailer leveraged beacons to provide a better click-and-collect experience for shoppers. They used beacons to notify customers when their orders are ready, so shoppers can make better use of their wait time.

2. Store navigation

If you have a big store, you should look into using beacons for mapping purposes.

That’s what Major League Baseball is doing in some of its stadiums. In addition to sending notifications depending on where game watchers are in the area, MLB’s At the Ballpark app can also be used as a navigation tool that helps people find their seats using their phones.

3. Using beacons for fun and entertainment

Holding an event? Make it more interesting by incorporating beacons into the experience. At CES 2014, for example, the organizers decided to run a beacon-enabled scavenger hunt that encouraged attendees to explore the conference.

Users had to download the official event app, and they used it to locate beacons in the vicinity. The app would alert them when they were near (around 10 meters) a beacon device, and it would reward users with a badge every time they found one.

Mistake #4: Not integrating beacon technology with your other systems or solutions

Beacons work fine on their own, but they’ll work even better when you connect them with your other systems or solutions.

For example, linking your beacon solution to your POS can help you gather data more effectively. Take Swarm, a beacon-powered solution for brick-and-mortar stores. By itself, Swarm can be used to gather foot traffic data and analytics; but when linked to a store’s POS system, the retailer can tie in foot traffic with sales and get insights on their conversions, thus enabling them to get a more complete picture of their store’s performance.

Your turn

What other mistakes do retailers commit when implementing beacons? Share your thoughts in the comments.

Looking for Retail Management Systems software? Check out Capterra's list of the best Retail Management Systems software solutions.

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About the Author

Francesca Nicasio

Francesca Nicasio is a retail expert from Vend, a point-of-sale, inventory, and customer loyalty software that helps over 15,000 retailers manage and grow their businesses. She's the author of “Retail Survival of the Fittest: 7 Ways to Future-Proof Your Retail Store,” a practical guide to modern-day retail success.

Comments

Informative post Francesca. Thanks for sharing. Though, beacons have today reached mainstream, most marketers are still unsure about how to leverage beacons and integrate it with their mobile strategy. This has resulted in a number of disappointing beacon trials too. And like you said, one of the primary reasons behind this is the lack of planning. For example, One of the biggest mistakes made by Arts Centre Melbourne in this beacon campaign was that they tried to replicate a retail approach in a cultural arena. However, many industry experts are of the opinion that the best way forward is for businesses to match their strategy plan with the needs and preferences of their consumers. We’ve discussed a few proximity marketing campaign success secrets that will help marketers ace their next campaign here:
http://blog.mobstac.com/2015/01/4-tips-to-kickstart-your-proximity-marketing-campaign/

“However, many industry experts are of the opinion that the best way forward is for businesses to match their strategy plan with the needs and preferences of their consumers.”

-Couldn’t agree more. There certainly is no one size fits all strategy when it comes to beacon implementation, which is why merchants really have to figure out what their customers need, and what they’re doing inside their stores.

And I appreciate you sharing that link! I’ll check it out.

Thanks so much for weighing in, Devika!

Hi Fancesca,

I am investigating beacons more from a technology and not retailing perspective. But I have opinions on both.

It seems from what I read about the data broker business that stores should not let the store employees make decisions about what notifications to send and when, which is what Retail Category Consultants said. Rather the store’s computers and marketers should do that. The beacon can track the customer by their IMEI, yes? So they can tell when the customer is a returning customer and what they have bought before if the POS tracks the IMEI as well. Since the beacon can place the customer in front of, say, the perfume counter, if this customer has bought perfume before then send them a notification to their device offering a discount on perfume.

Is that a good way to use the technology? What about using it for tracking to build up a customer profile to be sold to data brokers in addition to just using it to pitch ads to single individuals? I understand that retailers are making money from selling data on their customers. Seems to me this data would be much more accurate than say Google Adwords. Because you can tell where the customer went, what they looked at, what they bought, if they walked out, and if they came back another day. That’s far more valuable that tracking cookies in a browser, yes?

regards,

Walker Rowe

Thanks for the comment, Walker!

I agree that the store’s computers/marketers should determine the types of messages that shoppers receive. But if the store is implementing beacon technology, the associates should be able to pull up information such as a shopper’s purchase history or whether or not they’re a repeat buyer.

From that information, associates can figure out how to best approach a customer. For example, let’s say your beacon solution notifies you (or your staff) that a VIP customer has just walked in; in this case, the associate should familiarize herself with that customer’s preferences so she knows how engage with or assist that customer based on his or her past interactions with the business.

Hope this helps!

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Beacons seems to have made the “Whats big in x for this year” for the last 2-3 years running – yet we haven’t really seen them take off meaningfully and those who are doing are finding mixed results.

It’s Biggest weakness is the barrier to entry – i.e. requiring the consumer to install an app – mean that such a small proportion of a customer base engage that to see meaningful results or impact on a business is rare.

Push notification and engagement is only part of the story though and there are more seamless and robust solutions out there if retailers are looking for analytics and customer behavior analysis.

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