Beacons are coming. A new study from Juniper Research has found that nearly 1.6 billion coupons will be delivered annually to consumers via beacon technology by 2020, up from just 11 million this year, as retailers seek to develop proximity marketing campaigns in and around their stores.
The new research, Mobile & Online Coupons: Redemption, Loyalty & Consumer Engagement 2015-2020, found that several leading US retailers had now deployed beacon networks, with Macy’s having installed more than 4,000 in its stores.
The research observed that in-store beacons have consistently generated high redemption rates. It cited the case of the Chinese jewellery chain CTF (Chow Tai Fook), where a campaign in early 2015 saw redemption rates approaching 60%, resulting in a sales uplift of $16 million for the company.
Meanwhile, the research highlighted the opportunity presented by locating beacons outside storefronts, with the UK’s Proxama deploying a network of beacons in locations such as buses, taxis, shopping malls and airports. It argued that the introduction of similar ‘open beacon’ solutions could serve to drive both footfall and engagement.
The research also pointed out that the growth in contactless infrastructure and greater consumer awareness around NFC would lead to significant opportunities for proximity marketing in the medium term.
According to research author Dr Windsor Holden: ‘The launch of Apple Pay dramatically increased public and retailer awareness of NFC. As contactless usage accelerates at POS (Point of Sale), retailers will then move to incorporate NFC at all stages of the customer lifecycle, including loyalty and engagement.’
However, the research cautioned that the use of beacon technology was very much a work in progress, with many retailers concerned that excessive, indiscriminate messages ‘pushed’ by the beacon could be perceived as intrusive and damage their relationship with the customer. With that in mind, it suggested that retailers should follow the lead of Target, which has stated that it will limit the number of push notifications – including coupons and special offers – to 2 per visit.