What Comes Next for Indoor Navigation? Enterprise Success, SMB Struggles

“Is there enough ROI here for us?” It’s a question brands are asking with increasing frequency as they evaluate the role that indoor navigation and mapping are playing in their digital strategies.

Despite steady growth in the space over the past decade—thanks in part to the integration of AI and machine learning, and also to wider consumer adoption of smartphones and other location-enabled devices—brands and retailers are still running into obstacles that can make implementing the latest indoor navigation solutions a challenge. Those obstacles could be slowing down growth in an industry that’s been on the verge of moving into the mainstream for nearly a decade.

“There is certainly still interest in indoor tech. However, there is usually a tradeoff between precision and scale,” says Matthew Russo, chief operating officer and chief marketing officer at Gimbal, which develops location-driven products for advertising and marketing. “Lots of really great, precise data can come from well-architected indoor tech solutions. But scale is often the biggest hurdle brands and retails run into.”

That lack of scale could come from a limited number of customers using the retailer’s app or a limited number of locations those customers and app users are interested in enabling. It could also come from the retailer having a limited number of zones or sensors within each store location.

In any case, Russo says that at scale, indoor location technology is advanced enough that it works incredibly well. Russo says that at Gimbal, he has worked with major brand clients who are able to understand when a VIP walks into their lobby. They also know if the customer has waited too long at a check-in line, and they’re able to present customers with special offers or keyless check-ins at their rooms.

“But if you’re a pizzeria owner with a single storefront looking to send a push notification to people walking by, you probably won’t see the results you’re hoping for,” Russo says.

Could those scaling issues be holding back the indoor navigation industry, and if so, what’s the solution?

A number of technology vendors are working to move indoor mapping and navigation into the mainstream. Inpixon Chief Operating Officer Soumya Das says it usually takes multiple technologies to meet customers’ needs these days, and top companies are now positioning themselves as the providers of “platforms” instead of “products.”

“We offer a portfolio of integrated solutions covering all four of the essential building blocks needed to make indoor spaces information rich and helpful: mapping, positioning, analytics and developer tools,” Das says.

As the indoor navigation industry has matured, Das has also seen a change in how retailers evaluate technology partners. He says brand clients now are weary of partnering with point-solution providers and unproven startups.

“The momentum is still there and the adoption rate is accelerating,” Das says. “It’s less of an evangelistic sale now that the use cases and customer case studies that demonstrate the ROI are more plentiful.”

Pinpointing Areas for Growth

Globally, the digital map market is projected to expand from $13.9 billion this year to $29.4 billion by 2024. Indoor mapping registered an even higher growth rate during the forecast period, as the technology is being deployed at hospitals, shopping malls, and residential spaces. One of the primary drivers of this growth is the increasing adoption of mobile computing devices for navigation, as well as wider adoption of 3D platforms and more advanced technologies for surveying and digital map-making.

Another area where navigation solutions vendors are finding space for growth is with E911. Point Inside Chief Executive Officer Jon Croy believes the FCC’s wireless Enhanced 911 (E911) will help drive adoption of indoor navigation technology across multiple venue types beyond retail.

The FCC has introduced indoor location accuracy benchmarks into its E911 program, mandating that the carrier provide accurate indoor positioning and floor level in the ‘automatic location information’ response to the public safety dispatcher.

“Getting to a reasonable accuracy will require indoor positioning, and indoor positioning system generally requires a spatial framework—a map,” Croy says. “In general, this is a tailwind. How it plays out and actually drives adoption is yet to be seen. But it is definitely a factor.”

Croy anticipates that the FCC will ultimately regulate at the carrier level, and carriers will use their 5G deployments as leverage to get good in-building maps.

Regardless of the number of potential use cases, Gimbal’s Russo says technology companies need to focus on building top-quality technology with straightforward implementation, use, and simple system maintenance. As is the case with many industries, the indoor navigation space will need to focus on the basics if it hopes to continue to grow.

“Reducing friction is always a goal. It doesn’t matter how performant a technology is or how much utility it might bring to an end consumer; if it’s difficult to set up, configure, and get working, it won’t go anywhere,” he says.

Once a quality system is installed, Russo says the location data available to the brands or retailers can be beneficial across a variety of internal departments, from operations to marketing to customer service.

Privacy in Location

Customer privacy has been a hot-button topic in the indoor navigation industry, and with issues like the European Union’s General Data Privacy Regulation in the news over the past year, it’s something retail clients are bringing up as a concern as they look into implementing the technology into their own mobile apps.

Inpixon’s Das says his company has been working to change the narrative around location privacy. Inpixon markets itself as “The Indoor Data Company” and its mission from product development to sales, is to “do good with indoor data.” Although Das concedes that concerns about tracking and privacy are valid, he says it is definitely possible for companies to deliver business intelligence and location services while preserving privacy.

“We are proactively engaged with GDPR practices, supporting our employees, partners and customers with training programs to learn and follow the guidelines,” he says.

At Placer.ai, which focuses on location analytics for physical places, CEO Noam Ben-Zvi says there has always been a “significant divide” between companies that are collecting personally identifiable information and those that are not.

“For the latter group, compliance is critical, but once that is taken into account it’s business as usual,” he says.

The indoor mapping space today might not be where analysts predicted it would be a decade ago, but interest from industry giants is moving things in a positive direction. Just this month, news spread that Apple is planning to build infrastructure for an indoor navigation service. The company currently relies on indoor maps, but the incorporation of a wireless technology, called ultra-wideband, into iPhones would significantly increase the precision of indoor mapping and open the door for industry-wide growth.

“The influx is a great signal of the sector taking off and the value that people are seeing in the technology,” Ben-Zvi says. “There are companies that can collect data, others that can analyze it effectively and still others that have a sense of how to transform that raw information into a product that can provide value and accessibility. But the combination is very challenging. The breakthroughs are going to come from the companies that succeed in finding that mix.”

Stephanie Miles is a senior editor at Street Fight.Rainbow over Montclair

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