DSrupted: “Growth Hacking” Retail With Beacon Technology
July 29, 2014 by guest author, Charles Regula
Guest Post: Doug Thompson, Dot 3
Retail is the New Digital Battleground
Physical world retailers will need to adopt the growth hacking strategies of their digital cousins if they’re going to survive.
To some, growth hacking might just be a fancy name for online marketing. But at its core it represents the idea that marketing, sales, design and technology need to work seamlessly together to launch and measure experiments and systems for customer acquisition and sales.
In the world of retail, digital has too often been the enemy: show-rooming and e-commerce were first the enemy of in-store traffic and sales. Next, they supplemented what a retailer could do to acquire customers. But both approaches treated “online” as a separate thing.
iBeacon technology isn’t the only thing that has changed the equation – but it’s going a long way to erasing the boundaries between digital and brick-and-mortar by erasing one of the last hold-outs in the digitization of commerce: physical space.
Because in a world of iBeacon and related technologies there is no offline:
- Every door can be equipped with an accelerometer and trigger interactions with your customers
- Every shelf can trigger digital displays (on your customer’s phone) for advertising, branded content and coupon dispensers
- With your customers carrying beacons in their pockets every store or coffee shop is a pop-up social network
- Every time your customer leaves the store is an opportunity to either figure out why their shopping cart is empty or for social referrals and satisfaction surveys.
Your local American Eagle or WalMart is probably some of the most heavily analyzed real estate in your neighborhood. And yet the kinds of user insights and interactions that you get in a store are nothing when you stack it up against the kinds of data, insight and strategies that get deployed online. After all:
- How often are store displays designed to go viral?
- How often is a content strategy used to drive time-in-store?
- How often do you see on-the-fly A/B tests of offers that are updated in real-time with ideas discarded almost as quickly as they’re created?
These are all growth hacking strategies, and they’re coming soon to a store near you.
The World is the New Platform
Apple’s new head of retail believes that there should be a seamless customer experience that bridges bricks-and-mortar and online. And for Angela Ahrendts it’s not coupons that drive the experience but a richer blend of storytelling, service and physical/digital integration.
In an absolutely must-read post for anyone working in retail (or who wants to speculate where Apple will go next with her at the helm of online/offline retail), Fast Company describes her approach while at Burberry:
Believing that good service requires knowledge and that more personal service needs more intimate knowledge, Ahrendts has ensured that Burberry’s sales team is the best prepped in the fashion industry. During the past year, the company has activated a system allowing all associates, in all 330 Burberry stores, to have at their fingertips, on their iPads, all relevant customer information gathered from their activities at Burberry.com as well as in-store.
When I toured the Regent Street store in London last summer, I was assured that browsers like me–I get all Garbo whenever I shop for clothes–can even be registered as preferring hands-off treatment, though I wonder how that really works. (“What is your name?” an associate might ask. Tap, tap, tap. “Oh, Mr. Chu! I see you like to be left alone! Bye-bye!”)
And in a world of iBeacons the story will sound familiar. Because while it might sound compelling to bump your sales by pushing coupons as your customer wanders the aisles, it doesn’t take long before someone asks why the heck they’d even keep Bluetooth on if all they’re going to get is a flood of offers and vouchers.
What do you do, after all, if your customers just want to be left alone?
Retail is the New Content Marketing Channel
Brandpoint sees iBeacon as the new touchpoint for content marketing:
The potential uses for this technology are just beginning to be explored, but one thing is for certain: this will be a powerful new tool for content marketers and we should be thinking now about how to capitalize on its potential.
They see three ways that iBeacon can drive new ways to use content to engage with customers:
- Shopping Behavior: “Shoppers will have the ability to collect real-time information, comparison pricing, discounts and other helpful, highly tailored data as they walk through a store or browse near particular items. It will be imperative to produce well-timed, compelling content that is useful in those crucial moments before a choice is made.”
- Micro-location: “Digital content will be more closely tied to the physical world. The technology is extremely precise and can pinpoint your location as you move around in a space, quietly and conveniently customizing the alerts you receive.”
- Increased Engagement: “Rather than just providing information suitable for a web browser or even a mobile user, marketers will need to think about ways to provide content that will be of value to users as they live their lives. From businesses to city parks to our own backyards, we will be able to access helpful, real-time data like never before.”
Are You Ready to Merge Digital and Physical?
The key paradigm of growth hacking strategies is the way in which it breaks down the silos between teams. When applied to digital marketing, growth hacking teams are comprised not only of analytics experts and web developers but also include sales and marketing.
Think of growth hacking teams as an internal SWAT team that brings together all of your disciplines to run an endless series of tests that drive traffic and sales. But apply this methodology to retail and you might come up against the wall that’s been created between online and offline operations.
Even Apple isn’t immune from the challenge and Ahrendts has her work cut out for her in Cupertino:
At Burberry, she pushed for a seamless consumer experience between online and brick-and-mortar. Everything about the messaging was unified, from the music played on the website and in stores to the photography and displays, all of which Bailey’s team curated and produced in-house…
This points to an even bigger challenge (at Apple): How easily will Ahrendts merge the digital and retail staffs, who have never worked well together?
“Online has such an inferiority complex. It has always had something to prove to retail,” says one former online team member. “But retail didn’t give a shit. Retail totally thinks they’re superior. There’s a real opportunity for Angela to bring a breath of fresh air and warmth to the culture.”
With iBeacon the Device is Just the Beginning
Re/code recently ran an article which pointed out the obvious to readers of this blog: a beacon is just a beacon without an app to connect it to. They point out:
In order for these beacon indoor proximity systems to work and send messages to phones, the customer has to actually download the app of the retailer, brand, band, team or whatever kind of organization is using the system. Without the app, there’s nothing for the beacons to communicate with. This might seem obvious to those who know how the beacon systems work, but it’s still a pretty significant problem to anyone who doesn’t specialize in app download marketing.
To that end, we’ve proposed five approaches to UX that will help us think about how iBeacon experiences are designed in a way that encourages customer acquisition.
But we also proposed that we need to think of iBeacon less as a ‘push’ technology and more like seduction:
We tell marketers that Bluetooth LE isn’t the answer: it’s part of a larger user experience. Just like it’s not usually advisable to, um, pay to be intimate with your customer…it also isn’t advisable to think of Bluetooth LE as a short cut to intimacy. You still need to woo them, seduce them, and treat them real well – and no amount of ubiquitous or contextual computing is going to change that.
From the very granular level of your application architecture, you’re going to need to think about:
- Online and offline tools to help prompt an app download
- Email and other ‘reminder’ campaigns to bring users into the vicinity of your location
- GPS-driven geofencing and geoaware technologies to help locate and do initial app ‘wake-up’
- Alternate ways to push notifications to address different user scenarios
- Bluetooth LE beacon detection for initial beacon ranging
- Beacon ‘pairing’ and other technologies for close proximity messaging and app content changes
- Back-end systems for content management
- Integration with CRM, social media and APIs
- Back-end analytics
Hear Doug speak at DSrupted 2014. Register now!
5 Ways to Growth Hacking Retail with iBeacon
Many of these suggestions come straight out of the growth hacking playbook. While often driven by the needs of lean teams and start-ups with few resources, there are a few key pillars to growth hacking that can now be applied to physical space: user acquisition, on-boarding, monetization, retention, and virality.
As a retailer, iBeacon extends your current in-store systems right to the entrance or shelf. And to the iBeacon developer, figuring out how to ‘growth hack reality’ should be as much a part of your development plan as placing the beacons themselves.
To give you a taste of growth hacking strategies for this brave new world of iBeacon and connected tech, here are five ways that give a taste of the kinds of strategies we’ll see in the months ahead (inspired in part by The Next Web’s article on the topic of online strategies):
1. Build Viral Content Into Physical Displays
Online it’s easy to click and share. Offline, not so much. Sure, someone can take a photo of your shop window and post it to Instagram, but what if the sharing function was built into the display itself via Bluetooth LE beacons? Physical displays can now contain the equivalent of a “pin” or “like” button.
2. Figure Out Your Paid Acquisition Strategy
Retailers will use online and offline paid strategies for app download and acquisition. A local Twitter ad, a Facebook or Google ad…each of these can be a geolocated touchpoint just before your customer enters your store – and a chance to drive app downloads before they arrive.
3. Content Strategies at Point of Sales
Physical space is a new content channel. Think of all the offers you get for white papers or “secrets of success” and think about how they’d apply to physical stores. Have you got some product information you think your customers would like? Maybe a video that shows how plasma TVs are made, or a white paper on sustainable fishing. The physical world is the new content distribution channel and can be precisely targeted to the aisle.
4. E-mail and Push Marketing
E-mail rules. Does your iBeacon strategy include an e-mail notification or update stream? Can offer to e-mail a customer product info at the point of sale? I don’t care what anyone says but e-mail is still the de facto way a lot of us organize digital communication – and I’d love to see a sign in a store that says “let us e-mail you some product information” that took nothing more than a click of a button inside a beacon-enabled app.
5. A/B Analytics
And last (but perhaps most important) is how you test: because while you might not have been able to test product placement on a shelf in real time, you can definitely test a lot MORE with iBeacon and other technologies. But how fast do you respond to that data? How quickly can you launch prototypes, tests and experiments and how fast can you eliminate or elevate programs based on how they work?
Beyond the Beacon: What’s Your Strategy?
So let’s look beyond the beacon. There’s no offline. Your digital and brick-and-mortar strategies need to be integrated and treated as all part of the same customer journey.
What strategies are you using? How will you get customers to download your ‘beacon app’? And what other techniques from the world of digital now apply to the physical world as well?
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