Proximity marketing, according to beaconstac, refers to communicating with customers at the right place, the right time and with highly relevant and personalized messages, on their smartphones – be it greeting at the entry points, special offers in the store aisles, or getting feedback on a new product.
According to a recent report by Markets and Markets, “The proximity marketing market is expected to be worth USD 52.46 Billion by 2022, at a CAGR of 29.8% between 2016 and 2022”.
Figure 1: Proximity marketing growth (source: Press Releases)
The key reasons for this renewed focus on proximity marketing and its impressive growth are:
In other words, one of the most effective ways to reach the consumer with targeted messages is to deliver it to their mobile devices. And being able to deliver it at the right time increases the effectiveness manifold. After all, would you remember to use a pharmacy discount coupon for 20% mailed to you 2 weeks ago, or would you remember to use if that coupon magically popped up when you are at CVS Pharmacy shopping?
That is the power of proximity marketing and in the rest of this article, we will discuss some key technologies that are driving use-cases for this exciting marketing medium.
The essence of making proximity marketing work effectively are:
Both are important. Let’s first discuss the first requirement: “reasonably locate the user”. This relies on being able to get the location of a user who is typically indoor, so GPS is generally not an option. Indoor location solutions are often called “IPS” (Indoor Positioning Systems).
The key requirement here is to identify if the user is at a particular section (such as “Men’s clothes” in a retail store, vs “Women’s Apparel”). The granularity of this location depends on how large the site in question is, but in general, we are looking at a granularity of around 10-20 feet on average. Bluetooth and WiFi both have advantages and disadvantages:
|Bluetooth/BLE||More precise location (~ 3ft)||Unlikely the location has Bluetooth beacons installed, will need new hardware
Bluetooth beacons only ‘transmit’. You need an app on the phone, or a specific beacon advertising protocol (iBeacons for iOS and EddyStone for Android) for phones to use its information for a true IPS System
|WiFi||Works by fingerprinting wireless signals from phones. No software needed on devices.||Not as precise as Bluetooth, but with the help of intelligent triangulation and clustering algorithms, can reach a 10-15 feet range|
(There are other IPS technologies like RFID, Video-based location and Geomagnetic sensors which are not covered in this article)
Based on interaction with over 100+ customers, the common feedback we have received is that most of the customers prefer to achieve IPS using WiFi due to existing infrastructure and no need for apps.
Now that we understand how indoor positioning is enabled, let us delve on the second part of Proximity Marketing, which is “We must be able to deliver relevant content”
This is where we need a solution that can convert customer positioning data into meaningful business outcomes. HSC’s advanced WiFi Analytics solution, for example, seamlessly works with WiFi-based location data to bring out such business outcomes. Some interesting use-cases are discussed in this section:
A hospitality provider used our Social Analytics feature to better understand a trend of the general age group/demographic of its customers visiting its new lobby and used it to fine tune digital advertising messages on signage boards. In this case, it realized a large portion of the visitors between 5 PM – 7 PM was in the 40+ age range, while the age group dropped to 20-30 after 7 PM. They used this intelligence to advertise a new whiskey/cocktails lounge in the first time range as visitors passed by but switched to more aggressive advertising for a dance room/lounge later. Both locations saw an uptick of ~30% in new orders over a period of 2 months
A retailer with multi-level shops used our analytics heatmap knowledge to let users know via their loyalty app that queues in a different location were much shorter than where they currently were. This resulted in a 40% improvement in average queue length as this proximity advice changed dynamically.
The combination of intelligent analytics collected from WiFi signals and the ability to deliver location-specific advertising can significantly improve the quality of advertising towards prospective customers. If you are interested in speaking with us about how our WiFi Analytics solution can help you with increasing more sales or increase customer satisfaction, please contact us using the form below.