6 Reasons Why Beacon Programs Fail

Beacons have been heralded as the future of retail, with 85% of retailers expected to use the technology by 2016. But getting a successful proximity-marketing program off the ground involves more than just setting out a few digital devices.

A bad user experience or a lack of infrastructure can derail even the most ambitious beacon program, which is why executives from some of the industry’s top firms are now focusing so heavily on client education. By offering guidance during the setup process, technology providers are hoping to help retailers overcome common challenges and launch more successful beacon programs.

Here are the top six most common reasons why beacon programs fail, as seen through the eyes of experts working in the industry.

1. Retailers are trying to run before they walk. “We’ve seen retailers deploy beacons and immediately want to run advertising campaigns. We advise measuring data first—customer dwell time, pathing, etc. —to get a sense for patterns and volume before determining the efficacy of their campaigns.” (Alex Finkel, Roximity)

2. The infrastructure isn’t right. “There are two challenges associated with beacons, one of technical nature and one pertaining to guest experience. The technical challenge is getting the beacon infrastructure right—the number, placement, and interaction of beacons. As an example, one consideration for Wisely is that restaurant managers don’t want to receive a false guest arrival notification, when in reality the guest is walking by on the street, or is in the business next-door. These sort of challenges are easily solved if you have the right partner.” (Mike Vichich, Wisely)

3. Success metrics aren’t defined. “Retailers [are] failing to define business goals and success metrics, focusing more on their needs than their shopper’s needs when designing in-store mobile experiences, and neglecting to incorporate a testing agenda in their plans. Retailers should let their goals and metrics guide each step of the process, and they should put themselves in their shoppers’ shoes to ensure that their beacon marketing campaigns truly enhance the in-store experience. Additionally, retailers should be constantly measuring and testing new content, offers and messaging in order to improve the performance of their beacon marketing programs over time.” (Rob Murphy, Swirl)

4. Beacons are being under-deployed. “Having too few beacons in the store does not allow for location-specific messaging, or the beacons may be too far from the shoppers to trigger a message. [Retailers should] put enough beacons in the store so that they can a.) reach shoppers anywhere in the store, and b.) collect some useful data about shopper traffic, assuming the shopper has opted in.” (Shekar Raman, Birdzi)

5. Retailers are relying too heavily on their own apps. “[One thing] slowing down beacon technology adoption is the fact that the current model relies heavily on the retailer’s own mobile app, which is used mainly by the most loyal customers. There are also an important number of people who will not have an app for each retailer. The presence of a generic app on the shopper’s phone, compliant with iBeacon technology, could enable retailers to get more insights on shopping behavior, as well as engage with a bigger number of people.” (Doru Șupeală, Onyx Beacon)

6. Retailers aren’t committed to mobile. “Clearly ‘mobile’ is coming, and more and more execs are truly realizing the power of the data that is generated from mobile devices—specifically, via beacons. That said, surveys show far fewer retailers are committed to doing what it takes to make mobile part of their DNA and finding ways to incorporate the wealth of mobile data with their existing data to create powerful experiences for their customers.” (Alex Finkel, Roximity)

Interviews have been edited for length and clarity.

Stephanie Miles is a senior editor at Street Fight.

  1. Proximity Marketing
    August 12, 2015

    Great article covering just 6 of many more shortcomings. Check iSign’s Smart Antenna, which doesn’t require an app, and doesn’t have any of the limitations of beacons. It’s machine to machine connection means any smartphone can receive rich messages instead of just chirps. http://www.isignmedia.com

  2. August 13, 2015

    Great points, follows exactly the same lines as my thoughts. I would like to add two further aspects to the list:

    7. Relying solely on beacons

    Beacons are excellent devices for delivering targeted on-spot advertisements indoors. However, what beacons fail in are outdoor use and their ability to gather detailed analytics in large venues. In order to fully benefit from your indoor analytics, it is crucial to know also what’s happening outside of your venue. Who’s walking by your premise or in the nearby streets, and what’s the small percentage that actually enters your location? Even though outdoor beacons also exist, scattering them around the city would be a waste, as you could use GPS/cellular/Wi-Fi navigation information for that. Similarly, in large indoor venues installing beacons to cover the entire area would be a huge investment and maintenance burden. In those cases it would be time and money-efficient to map the venue with IndoorAtlas and use geomagnetic navigation information to complement your analytics. In short, to get the most out of your beacon deployment, you should combine beacons with other location technologies.

    8. Using beacons only to push advertisements

    As already mentioned in the first point, retailers should not start their beacon experiments by pushing location-specific advertisements to their customers. I would argue that retailers should really limit the use of direct advertising and focus on all the other possibilities that beacons and other navigation technologies provide.
    By adding some intelligence to your system, you can use beacons to e.g.
    – send notifications to staff, when visitors enter a specific area of your store
    – Connect beacons to digital screens of your shop and display targeted advertisements to passers-by
    – Automatize and customize lights, doors and other electronic systems
    – Count how many times a customer comes into your premises, and offer them a discount of their tenth visit
    – Count the amount of visitors in your premises and offer a discount, if there is very many or very few customers in the shop
    And so forth..

    If you want to know more, check out our website. http://proximi.io

    – Annina / Proximi.io

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