When Apple launched iBeacons in 2013, proximity marketing became the industry’s favourite trend. With the right technology, this hyper-localised strategy was supposed to bridge the divide between online content and offline consumer action but Apple’s iBeacon platform ultimately failed to take off.
Google’s beacon system has enjoyed more success and created an open-source environment for developers. Regardless, beacons haven’t taken over the marketing world in the way so many predicted, however, some of the world’s biggest brands are redefining the customer experience with proximity marketing - with or without beacons.
Which brands are using proximity marketing in 2020
For examples of brands using proximity marketing in 2020, you only need to look at what the world’s leading retail brands are up to. So why not start with the world’s biggest retailer? Amazon is trying to reshape the in-store customer experience with a fleet of Amazon Go stores where customers can simply walk in, pick the items they want and walk right out - no queues and no physical payments action whatsoever.
Amazon pulls this off by combining computer vision, deep learning algorithms and sensor fusion into what it calls “Just Walk Out Technology”. In other words, the retail giant is using a lot of cameras, sensors similar to those used in self-driving cars and deep learning to track shoppers throughout the store and bill the right person for the right product.
There are currently 26 Amazon Go stores open across the U.S. and more announced to follow.
Last year, Amazon also used beacons to track attendees at re:Invent, one of Amazon's largest Amazon Web Services (AWS) conferences. Rather than using the technology to send personalised messages, Amazon later stated that the devices were used to track foot traffic anonymously and gain insights into crowd behaviour.
Nike is another retail giant driving proximity marketing innovation and the aptly-named Nike House of Innovation in Shanghai is its most impressive nod to the future of smart cities and consumer spaces. More than 40 beacons are placed across a 41,150 sqft space across four floors in the famous Nanjing East Road shopping district. Sensors detect which pair of footwear visitors are trying on and relevant information displays on the walls and floors that largely comprise of digital screens. Items can also be reserved by customers and picked up from lockers at the venue and, of course, there’s no need to queue at any checkouts.
Customers can simply pay instantly using their mobile phones.
One of the most successful uses of proximity marketing also happens to be one of the oldest, though. The Starbucks mobile app allows customers to place orders, pay in-store, collect rewards and receive custom offers from the biggest name in high street coffee.
The Starbucks app has been so popular that, until last year, it was the most used mobile payment platform in the US - outperforming Apple Pay, Google Pay and all dedicated payment apps. Admittedly, Apple Pay overtook Starbucks in 2019 but we’re talking about a coffee chain here and an app that still used more than Google Pay and Samsung Pay combined in the U.S.
Can proximity marketing save the high street?
Major brands like Amazon, Nike and Starbucks are proving that innovation can bridge the online and offline divide for consumers. The UK is deep into a high street crisis with fewer people visiting stores every year and a growing number of retailers going out of business.
At the same time, shopping habits are changing and online spending continues to increase. Yet, there are parts of the consumer journey that online-only technology can’t fulfil - and this is where retailers need to innovate most.
People in Shanghai can’t try on new shoes using their phones but they can visit the Nike House of Innovation and immerse themselves in one of the most engaging footwear experiences in global retail.
The brands we’ve looked at in this article are using proximity marketing to remove the problems of buying in-store (queuing, payments, etc.) but also to enhance the benefits of in-store experiences - seeing items with their own eyes, trying them out, collecting purchases, etc.
The technology that powers proximity marketing is only going to improve as smart cities grow and IoT becomes a part of our everyday lives. But the technology, in its current state, is already there to redefine customer experiences and the way consumers engage with brands, based on their immediate location.