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Apple has a long history of disrupting the personal computer and smartphone market. It has been an incremental innovative force ever since the introduction of the Macintosh back in 1984 and undoubtedly sets the customer expectation bar for other manufacturers to catch up.

iPod, iTunes, iPhone, iWatch… The list goes on.

One such innovation is the iBeacon technology. This technology has tremendous potential in elevating the customer experience and satisfaction inside a physical store and is critical for proximity marketing (targeting potential customers with personalised ads based on how close they’re to a particular location).

It’s the next big revolution in the world of the Internet of Things (IoT) and can increase footfall and boost sales due to its ability to offer personalisation. 

A lot had changed about iBeacon technology since its introduction almost a decade ago. In this article, we’ll take a quick look at what iBeacon is, how it works, and how the technology is shaping in-store interactions.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 1Image Credit: medium.com

What Is iBeacon?

iBeacon is a protocol created by Apple. It was first introduced in 2013 at the Apple Worldwide Developers Conference, and since then, many vendors have developed iBeacon-compatible transmitters, and they’re collectively called beacons.

So, the term “iBeacon” and “beacon” are used interchangeably.

Similar to the iBeacon protocol, Google developed Eddystone for Android and iOS devices. There are numerous other beacon protocols, including GeoBeacon and AltBeacon.

Beacons are devices that broadcast small amounts of data using Bluetooth Low Energy (BLE). In other words, beacons are a class of BLE devices that transmit small bits of information up to a radius of 50 meters. As a result, beacons are commonly used indoors, although they can be used outdoors.

Imagine receiving a personalised message on your smartphone whenever you enter a store. The message might also include information about deals and offers on your favourite products and also about the latest arrivals. Such a personalised, relevant message is more likely to entice even window shoppers to make purchases and is made possible with beacons.

Beacons or iBeacons are often stuck to a wall and would probably look like one in the following image.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 2Image Credit: iBeacon.com

Beacons can help businesses improve their sales by working on the most crucial factor – customer satisfaction. A feeling that a business “remembers” the needs and wants of a customer can lead to repeat purchases.

Smartphones (more precisely, portable electronic devices) are critical for beacons to work. Since beacons use wireless technology (BLE), the device must have the hardware and software capabilities to receive the message. Also, individuals must have the required mobile apps installed on their devices.

With the help of an app, iBeacon can also be used as an indoor positioning system – similar to the global positioning system (GPS) that helps pinpoint your location and navigate using apps like Google Maps.

What Is iBeacon Used For?

  1. Beacons can be used to enhance the in-shop experience, increase loyalty, and boost sales.
  2. iBeacon can be used for automation, for example, opening garage doors without pressing any buttons or turning lights on or off when you’re near them or away.
  3. Beacons can be used to deliver contextual information. For example, inside an aquarium, beacons can be used to provide more information whenever an individual is near an attraction.
  4. Beacons can be placed on tables at restaurants. Customers can view digital menus and make orders with ease.
  5. Beacons can make indoor navigation simpler.

How Does iBeacon Work?

iBeacon technology is comparable to location-based services like geofencing. However, their range and hardware requirements are different.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 3Setting up a geofence. Image Credit: xtremepush.com

Generally, if you’re serving location-based ads using geofencing, you just need to define the virtual boundary (geofence) on the app’s backend, and the rest gets done on the customer’s smartphone.

But for the beacon technology, you require special hardware (beacons, like the ones shown in the above image) to detect smartphones or tablets whenever customers come in close proximity. Only if a device is detected will the beacon understand that the same device is near and worthy of receiving notifications.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 4Beacons can be placed in multiple locations inside a store. Image Credit: xtremepush.com

However, do note that beacons don’t transmit notifications or messages.

This is a common misconception as many assume the small amount of data transmitted by the beacons is shown as messages or push notifications on a customer’s smartphone. The payload of data packets sent via BLE is quite nominal (251 bytes with the latest version) and usually includes,

  • Beacon ID
  • Sensor data
  • Battery level
  • Measured power

As you might have guessed, you need an app installed on your smartphone to receive notifications or messages. With the help of the data transmitted by a beacon, the app understands that a device is near it. This triggers an event in the mobile application, and depending on the app could be push notifications, in-app messages, SMS, social media check-in prompt or emails.

As you can see, the iBeacon device (transmitter), smartphone (receiver), and iBeacon app are essential for the iBeacon technology to work. The beacons are usually fixed on a wall, or top of tables in restaurants. And the iBeacon range is generally set at 50 meters.

Along with being able to view menus or offers, beacon technology can also be used to make payments at stores – thereby reducing the need to stand in queues.

The smartphone’s BLE must be turned on for the app to detect the beacon. Also, other information such as the range within which the device will be detected, the app event that would be triggered and more will be specified during the iBeacon app development process.

It’s important to note that the iBeacon or beacon technology can communicate only in a single direction – meaning, the broadcasting devices (beacons) is a single-way transmitter that can transmit data to the receiving device. This ensures that only the installed iBeacon app (or at times just the operating system) can track customers and not the beacons themselves.

Apple has standardised the constituents of iBeacon data packets, and it contains the following four pieces of information.

1. UUID

It’s a 16-byte string used to differentiate a group of beacons. For example, if McDonald’s have a network of beacons, they would have the same UUID. UUID also helps in distinguishing a group of beacons from the beacons of other companies.

2. Major

It’s a 2-byte string used to differentiate a small group of beacons from a larger group. For example, if McDonald’s had installed ten beacons inside a store, then all ten would have the same Major. This will help McDonald’s understand in which store a customer is currently in.

3. Minor

It’s a 2-byte string used to identify individual beacons. For example, the beacon placed at the entrance of a store will have a unique Minor. Similarly, the one set in a specific product section will have a unique Minor. Minor allows companies to identify where the customer is in the store.

4. Tx Power

It’s a 1-byte string used to determine the rough distance of the device from a beacon.

Here’s an example of how the values of each component would look like.

UUID: B9407F30-F5F8-466E-AFF9-25556B57FE6D
Major: 92
Minor: 5
Tx Power: 1

What Is BLE?

Bluetooth Low Energy (BLE) is a wireless technology used to transmit small amounts of data over short distances. As the name suggests, this technology is designed to consume the least energy.

Nokia originally developed BLE in 2006, and it then was called Wibree. In 2009, it was integrated into Bluetooth 4.0 as Bluetooth Low Energy. It is used to connect to low data rate devices and is slower than the classic Bluetooth.

BLE aims to revolutionise appliances that appreciate low energy consumption, like smart devices, fitness, healthcare, and beacons, especially. The lower power requirement also means that BLE can operate for months (sometimes years) on a button cell.

BLE vs Bluetooth

Bluetooth can handle large amounts of data and so, is “battery hungry” and expensive. Compared to the standard Bluetooth protocol, BLE is designed to consume lesser power (1% to 20% of the standard Bluetooth) and send across lesser data. The speed of BLE if also lower and will have only 15% to 50% speed of traditional Bluetooth.

One reason why beacons use BLE instead of Bluetooth is due to the power consumption constraints. Batteries power the majority of beacons, and so, it is crucial that the beacons should be carefully balanced to showcase impressive performance without harming the battery life.

However, numerous beacon models can be charged via USB or plugged directly to power sources or solar powers.

Bluetooth is more expensive than BLE and is generally used when data transmission is frequent and heavier, for example, in a wireless mouse or headphone.

iBeacon vs GPS and NFC

First, the basics.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 5Image Credit: geotab.com

Global positioning system (GPS) is a satellite-based navigation system. It has an accuracy of 500 – 30 cm and is a critical technology that powers navigation applications like Google Maps. GPS works irrespective of the weather conditions and is useful for creating time measurements, navigation, tracking an object’s location, creating maps, and more.

iBeacon 101: An Introduction To Beacons and Proximity Marketing 6Image Credit: androidauthority.com

Near-field communication or NFC is a wireless technology that enables short-range communication between two electronic devices. Technically, NFC is similar to wireless signals like Bluetooth and Wi-Fi and transmits data over radio waves.

NFC technology allows users to exchange digital content, make secure mobile payments, and even connect electronic devices with just a tap. Although the majority of smartphones are equipped with the needed hardware and software for GPS, the same isn’t true for NFC.

NFC consumes the least amount of power – even lower than BLE. However, lower power consumption reduces its range and speed.

Despite being slow, NFC has one significant advantage – faster connectivity. Since the technology uses inductive coupling and doesn’t require manual pairing to function, it can be used to establish a connection between two devices in less than one-tenth of a second.

When comparing the ranges of a beacon, GPS, and NFC, GPS wins the round. GPS has an unlimited range and can reach any part of the world.

For every technology, there’s a trade-off between range, speed and power consumption. In that sense, the unlimited range of GPS means it consumes the most power compared to the other two technologies.

NFC, on the other hand, has a nominal range of just 4 cm. When considering its usage (pairing devices and mobile payment), the shorter range is justified.

As previously mentioned, iBeacons have a range of 50 to 70 meters. When compared to GPS, which is a critical technology behind geofencing, beacons have incredible accuracy. Numerous beacons can be placed at different parts of the same store and can be used to deliver offers depending on the products showcased near to them.

Geofencing, on the other hand, isn’t very accurate. You could use the technology to detect whether a customer is inside a building or a store, but determining which section of the store they’re at isn’t feasible.

Examples of iBeacon in Action

1. Virgin Atlantic

iBeacon 101: An Introduction To Beacons and Proximity Marketing 7Image Credit: runwaygirlnetwork.com

Virgin Atlantic conducted a trial of iBeacon at Heathrow airport. With the help of beacons, the smartphones’ of passengers heading towards the security checkpoint would automatically open the mobile boarding pass for inspection.

2. Major League Baseball (MLB)

iBeacon 101: An Introduction To Beacons and Proximity Marketing 8Image Credit: zdnet.com

In association with Apple, MLB installed iBeacons at various locations in MLB stadiums. Whenever an iPhone user with MLB Ballpark app installed walks near the iBeacons, they would receive a push notification.

3. McDonald’s

iBeacon 101: An Introduction To Beacons and Proximity Marketing 9Image Credit: kontakt.io

McDonald’s installed beacons in 26 locations in Georgia and Columbus to serve push notifications about special deals.

4. Voolsy

iBeacon 101: An Introduction To Beacons and Proximity Marketing 10Image Credit: voolsy.com

Voolsy is a beacon-enabled restaurant in India. With the help of an app and beacons, the restaurant lets customers check out menus, description of dishes, make customisations, place orders and pay.

5. Wayfindr

iBeacon 101: An Introduction To Beacons and Proximity Marketing 11Image Credit: awards.ixda.org

Wayfindr is a navigation app that uses beacon technology for indoor navigation. The app offers indoor audio navigation, which is incredibly useful for blind and partially sighted people.

In Conclusion

The best thing about beacon technology is that any retailer can use it to detect customers using any mobile operating systems on their physical stores. Along with increasing loyalty, beacons can also promote contactless initiatives like cashless payments and electronic check-in processes and serve relevant ads.

Beacon technology’s possibilities start where GPS struggles. Besides improving customer experience inside retail stores, beacons can also help visitors gain more information about different exhibits at museums. It’s also possible to use the technology to understand which product sections customers visit the most and least.

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