How Brands and Publishers Are Thinking About Beacons

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The recent explosion of innovation around brick-and-mortar stores is both a blessing and a curse for large retailers. A wash of new analytics tools and proximity messaging technologies can help these sellers more effectively compete with Amazon and other ecommerce firms. But these new capabilities also require retailers to invest massive amounts of time and money into rethinking a model that has worked for over 80 years.

“The data and analytics is important, but in the end it has to be about improving the customer experience first,” said Jennifer Bordner, marketing manager at Old Navy, during a panel at SXSW Interactive in Austin Tuesday. “What can technology do that feels more natural than an extra burden? In the end, it’s about bridging that gap between the physical and digital [experience] in a way that feels natural.”

One of the technologies that has come to define the promises (and pitfalls) of the new retail environment are beacons — small, often fist-size devices, that can communicate with nearby devices using bluetooth low energy. The technology exploded last year after Apple embedded a new protocol into iOS 7 called iBeacon that made it far easier for application developers to listen and trigger actions when a mobile device comes within range of a specific beacons.

For the startups building beacon technologies, the release of the Apple Watch last week represented an important next step in expanding the use cases for proximity technologies such as beacons. InMarket, the Los Angeles-based startup that hosted the panel, announced a new pilot with Marsh Supermarkets earlier this year that will allow the grocery chain, as well as publishers on its network, to send content to users’ Apple Watch as customers move throughout their stores.

The launch of Apple Watch has also created new opportunities — and pressures — for publishers to change a two decade-old distribution model built for the desktop web.  Craig Kostelic, head of sales at Epicurious and Bon Appetit, says the recipes site is shifting its strategy from driving traffic to a owned-site to seeding its content through partners.

“For a very long time, the strategy for publishers was to keep content on your own assets, or aggressively link back to a site,” said Kostelic. “What you’ll see from us is a pivot to communicate and partner to think about putting our content on as many platforms as possible.”

Epicurious already works with InMarket to send content to users who shop at the network of retailers, which work with the startup. Kostelic says the company will aggressively build its relationships with publishers on the Apple Watch to bring recipe and other food content to users as they shop.

But for retailers such as Old Navy, wearables present less of an opportunity — at least today. Instead, Bordner says the company is focused on rebuilding the back-end infrastructure that will allow the retail to test and deploy wearables, and future technologies, efficiently.

“For us, it’s that back-end infrastructure that’s critical to get in place so we can build something that we can flex on and pivot with and disperse out,” she said. “Wearables is something that we’re cautiously optimistic about, but I don’t think there’s space for Old Navy on the Apple Watch.” The data we can collect with Beacons is going to be more interesting than sending them push notifications.”

Steven Jacobs is Street Fight’s deputy editor.