Today’s guest post is from David Jones, Founder/CEO of StreetHawk. David is a serial internet company founder who previously started SurfControl Email Filter (now WebSENSE), ThreatMetrix and is a mentor with the acclaimed StartMate accelerator. You can follow him at @streethawkapp & @djinoz.
iBeacon Inverted Value Pyramid
iBeacon news is everywhere and changes in IOS 7 updates are making good news fodder but I want to clarify some real “value” points about iBeacon solutions. I’ll call this the “inverted value pyramid”.
This pyramid helps you decode the value of iBeacons in a business, brand, promotor or an App developer context.
The smaller the triangle, the lower the value.
Layers of Value: iBeacon, Passbook, Apps
So:
- At the base of the pyramid, iBeacon hardware on their own are the lowest value
- Next step up the pyramid is the possibility for retailers, museums, brands, airlines to incorporate iBeacon with some of the features of Passbook. I’ll do a detailed post on Passbook iBeacon integration because it’s good but has a few hidden gotchas.
- Most value at the top of the pyramid is integrating iBeacons with Mobile or Tablet Apps. The most flexible and meaningful uses for iBeacons are in conjunction with a specific experience. For example:
- A Museum can help users discover exhibit information
- Playgrounds and Museums will run treasure hunts for kids
- Dating Apps will allow proximity matching for “similar likes”
- Business Apps might exchange business card/contact data quickly
- Retail can measure footfall and attribute to a specific marketing activity earlier on the App
- Retail might trigger an event in Aisle 5 because a user put the Pasta Sauce on the shopping list.
- etc. The possibilities are limitless.
iBeacon Hype Hate List
Hate 1: my first item on the iBeacon hype hate list is: Assigning magical properties to a new gadget.
Much of the press about iBeacons latches on to the magical properties of “never-before-available” capabilities. The green section of the pyramid is what iBeacons can do for you on their own…..the answer is “not much”.
They might be great as a talking point and as a sales tool in a meeting, they help people to grasp the potential, but other than that you can’t make much use of them.
Hate 2: Magic Happens. The great news about iBeacon and Passbook is that it allows long-tail retailers to potentially use coupons without delivering Apps. It also allows big retailers/brands to use Passbook as a new customer acquisition channel.
However, here is my list of “it’s not magic” points:
- Implementation Magic – whether you do Passbook or Apps to implement iBeacons, there is a stack of planning and implementation to get this running. At this stage iBeacon needs technical people to get a deployment.
- Proximity Magic – iBeacons transmit “radio” signals – so reception varies. Problems include: iBeacon signal overlap, over-promising how accurate proximity will be. What happens when your phone is in your handbag.
- “Me, Me, Me” Magic – iBeacons will become pervasive. Why will a shopper prefer your Popup in comparison to all the other Popups in Passbook? Apple’s current implementation is to silently show Passbook, so it’s a high probability your user won’t see your coupon. My discussion above on Apps shows that if a user is already engaged with your Brand/Location/Venue/Retailer then you are going to get the best engagement and response rates.
- “One Beacon to Rule them All” Magic – Passbook is on Apple only – forget about Android users. In the US, EU, Australia this is roughly 50% of customers you are missing. In Asia, Android penetration is much higher so the Apple users are a small part of your customer base. Some startups are doing Passbook things on Android but its not automagically installed on Android phones.
Hate 3: No talk of cost of ownership – Here is how it will play out…
- You’ve deployed iBeacons and your campaigns but you don’t seem to be getting much response.
- Investigation reveals that your iBeacon near the front-door of the store has gone missing. Yep, stolen or “souvenired”. The replacement is more than $30 for the device, there is the setup of the new iBeacon ID’s and associated campaign configs.
- Not stolen? So you shake it a bit, give it a bang on the cash register but still no luck. Its probably got a flat battery. Some vendors are cleverly and correctly providing monitoring but you also have to provide the data paths to get that info back to a central monitoring platform, so that introduces security holes that IT are going to want to audit.
- Customer Hijacking – it’s possible to sniff other iBeacons. That means (as far as I can tell) your competitors could have an App that pops up a message when your customer enters your store – enticing them to come to their shop!
So there you have it. A quick fun post on the practicalities of introducing a new gizmo into your mobile marketing initiatives. The iBeacon technology wave will have great benefits but we think the big VALUE will be found in Apps.
This post was originally published at http://streethawk.com/blog and you can follow StreetHawk at @streethawkapp.
For more information on iBeacon, visit our proximity services resource center. If you’re ready to purchase beacons, check out our GemTot USB beacons.
