A breakthrough technology can pinpoint where a consumer is inside a store.
Bill Siwicki , Managing Editor, Mobile Commerce
A smartphone’s ability through built-in GPS technology to pinpoint a user’s location anywhere on the globe has made location one of the pillars of the mobile experience today. But while GPS can narrow location down to an address, it cannot isolate a smartphone user’s location indoors. This blind spot has led to the debut of the relatively new technology known as indoor positioning, which uses tiny sensors mounted in stores or other destinations to pinpoint at a very specific location indoors a smartphone user with an app attuned to the sensors.
Indoor positioning will have an enormous impact on retail strategists, writes Tony Costa, an analyst with Forrester Research Inc., in the recent report “Next in Tech: Indoor Positioning.”
“Major mobile players including Google Inc., Nokia and Qualcomm are committed to making indoor positioning a reality, actively mapping thousands of venues worldwide and improving the indoor positioning capabilities of computer chips,” Costa says. “Retailers, start-ups and venues are creating indoor positioning-enabled apps that improve engagement through personalized service, action-based rewards, augmented experiences and targeted offers. By integrating indoor positioning with back-end systems, product strategists can realize new benefits, such as enabling consumers to find the exact location of products in stores and the ability to bring the power of web analytics for tracking, targeting and understanding users in the real world.”
Web and mobile design and marketing firm Siteworx LLC is among the companies pioneering indoor positioning in retail with the debut of Customer Concierge, mobile commerce technology that retailers can use within their apps or as a stand-alone, retailer-branded app.
“The primary goal of the app is to personalize the in-store experience,” says Justin Stayrook, vice president of technical services at Siteworx. “Through personalization and/or segmentation of offers to encourage purchase decisions, the app can be used as an anti-showrooming tactic.” The app can serve as a personal shopping assistant and provide special deals and discounts, attracting consumers away from showrooming via Amazon.com’s app, for example, Stayrook says.
Customer Concierge is designed to work with a retailer’s customer relationship management, web content management, digital asset management and product information management systems, Siteworx says. The technology can present smartphone users with the app on their devices with personalized offers when they walk in or out of a store or a department within a store, Siteworx says. It can provide shopping or project lists related to a location within a store so retailers can promote items customers may have overlooked, the vendor says. And it can deliver product information, price comparisons and suggestions for complementary products within a proximity, the vendor adds.
So, for example, an apparel chain retailer could use the Customer Concierge technology in its app to send to a shopper (regardless of whether he has opened the app) a push notification message with a coupon promoting shoes when he enters or leaves the men’s suits department.
The technology is relatively inexpensive—the majority of the cost for Customer Concierge is in the services associated with strategy and implementation, Stayrook says. He would not reveal exact costs.
The sensors or detectors use Bluetooth Low Energy, or BLE, technology. The number of sensors a retailer would install depends on the amount of information it wants to disseminate, Stayrook says. “It also depends on how you want to evaluate and divide your audience,” he adds. “In other words, it’s a function of how large your store is and to what degree you want to subdivide products and services among customers.”
Indoor positioning may become increasingly important as a steadily increasing percentage of smartphone owners use their devices to help them shop in stores, mobile experts say. For example, one in five smartphone owners say they will visit a nearby store if sent a mobile alert when near the store, a recent CouponCabin.com study of 1,096 smartphone owners reveals.
“Making devices responsive to the environment will make in-store shopping relevant and increase the reliability of commerce via mobile,” Stayrook says.