Beacon Technology – What Is It? What Are the Potential Benefits for Brands in the OOH Space?

“Every time someone writes a 2016 (marketing) prediction they should publish what they predicted last year. Most predictions are off the mark”

Richard Shotton – Head of Insight at ZenithOptimedia (via Twitter 8th Jan 2016)

I strongly believe that the above is true so I am going to avoid making any sweeping predictions about Beacons. I am however going to explain what they are and offer my thoughts regarding the possible benefits to advertisers, now that beacon technology is being woven into the fabric of the OOH space. At this stage, I’d suggest that although some great tech is increasingly available right now, no brand or media owner in the UK has really made beacon technology work for them at scale.

There will be very few people below the age of 60 who would disagree with my assertion that smartphones have changed day to day life of many people in the UK. In my view they have done so for the better. Mobile technology has altered the way we communicate, source information, navigate our journeys, create photos or videos, do banking and make purchases. 10 years ago almost nobody had a smartphone (except for a handful of global executives with Palm Pilots or massive Blackberries). As of July 2015 smartphone penetration in the UK stood at 80% of UK mobile phone owners (*UM – July 2015 Games of Phones Research). Since then it’s likely that this figure has increased further. Mobile advertising growth has mirrored the widespread use of smartphones and tablets and now takes centre stage in the advertising media channel mix. Mobile has enabled unprecedented data capture and effectively mobile technology can be viewed as the equivalent of a “human cookie” offering up all sorts of behavioural patterns.

OOH advertising frames are placed in locations to ensure that messages hit high volumes of people while on the move or while they are in key destinations. The fact that people are increasingly using mobile devices in proximity to OOH sites mean that it is hard not to instinctively believe there should be a natural link between OOH and mobile. So far the technology on offer (QR Codes / NFC) has not been seamless enough to deliver true synergy. This is potentially changing.

In the mid to late noughties the OOH fraternity looked to use Bluetooth technology in order to deliver content to people’s mobile phones in designated hot spots (in proximity to posters). After various test campaigns it was widely agreed that this was not a technology worth using. It was too buggy and unreliable that we found it impossible to mirror the planned concept idea with the reality. I personally experienced and endured a couple of test campaigns that were so challenging that I vowed never to get involved with Bluetooth again. I thought Bluetooth was best left to Mini Cab drivers with ridiculous headsets on or people who could not connect their keyboards to PC’s without wires. However, in recent years Bluetooth has had a real resurgence. Low Energy Bluetooth is now standard in all new mobile devices. It has also evolved into what is now known as beacon technology. It’s not only back it’s better than ever…

What are beacons?

Beacon technology first arrived on the scene in the retail space. Beacons offer brands the opportunity to instigate a one-to-one communication with consumers via their mobile device. Essentially beacons are sensor units that transmit (within close proximity) to mobile devices via Bluetooth technology. Beacons communicate with apps on the mobile devices. Bluetooth and app notifications must be enabled for it to work. When software is updated on mobile operating systems Bluetooth is turned on as standard

Beacons either serve content through push notifications or “listen” for consumer activity which is tracked through the apps. The delivery hardware does not require huge investment. It’s the back end (software – access through apps) that requires the investment in terms of time, effort and funding. This is why testing is so important before full implementation. There are many systems out there. The most well-known examples in the market are iBeacons (Apple) and Eddystone (Google’s technology).

At the end of 2015 I sat down separately with representatives of our main OOH partners to investigate the current state of play regarding their testing of Beacon technology. Every company I spoke to had invested time and money and were looking for partners to test with.

These are the three main approaches that the media owners are taking:

  • Preferred CMS partner – The media owner chooses the CMS (Content Management System) provider such as Proxama or Gimble to manage the whole process and data analysis and then ask clients to run this through them
  • Full Access – Advertisers choose a CMS partner and work with the media owners and their software partners to make the campaign happen
  • 3rd party platform – an advertising opportunity is sold via publisher app. (This is explained in more detail below)

It’s all about the apps….

Apps on devices are the most important factor in making Beacons work or not. Notifications via the apps are the vehicle for communication.

If a brand wishes to use its own customer app it really needs to have critical mass in terms of downloads to be of use. But in reality how many brands have huge reach with their apps?

Alternatively beacons can communicate via 3rd party publisher apps. These are applications that are on a huge number of devices but are willing to let advertisers push their message through their notifications. Currently Exterion is running a test with the Shazam app alongside some key partners. Shazam has huge penetration in the UK market so can offer advertisers huge reach. In the German market Stroeer Media group owns both the rights to the Shazam app and the majority of bus shelter advertising. They are looking at putting beacons into 55,000 units being able to communicate directly with smartphone users that carry the app.

Why use the beacons with OOH?

The technology and infrastructure is available. Why would an advertiser or brand use beacons to contact consumers who are near to OOH sites? The one to one communication could be of benefit but what could brands use if for? Geo fencing can already track people’s whereabouts and send messaging though apps or texts.

Pure Advertising?

No: It would not be received well.

Advertisers could potentially use the service to send offers to people as they are on the move. To simply send pure unsolicited advertising to people’s phones via an app that has been downloaded for another purpose is hugely invasive. 3rd Party publisher apps need to be careful as if they are perceived to be spamming people then the mobile owner can quickly turn off notifications or even delete the app. If people can opt-out, people generally will. It would be better to use a Geo-fencing service to do this. I believe that beacons are not an advertising medium.

Communicating with customers? Yes and No

Noif the message is sent without a consumer seeing an advertising image

If a consumer receives a message through an app without being signposted by an OOH advert, the likelihood is that they could be confused as to why they have been targeted. This may not be an issue (as Geo-Fencing is already taking place) but there is a fine line between fantastic data targeting and consumers feeling like big brother is watching.

Yes – as long as they have seen the poster and the algorithms are good enough.

If a consumer sees a poster and then receives what they view as a relevant personalised bespoke message to their phone – with further relevant content – then the power of an OOH site will be amplified. Mass advertising can then be backed up by personal communication. If there is an interaction or subsequent search like behaviour through the phone, then this could be an extremely powerful tool.

DOOH – with its flexible scheduling can help unlock the further potential of apps. Also, the units that have the screens with have real-time feeds.

How the technology could potentially work

Imagine an airline with a good penetration of its app. They may have a limited one off offer online and on digital 6 sheets on a specific day. When consumers (signed into the app) walk past a D6s site showing the relevant ad, they see a notification on their phone inviting them to take up the offer. The consumer clicks through and the offer code is put straight into the app to look at later and benefit from the discount.

A TV content provider could advertise a show on a given evening targeting commuters. A customer signed into the programming app for the iCloud can click through a notification and the show would be saved on the person’s PVR box at home awaiting viewing.

When DOOH becomes fully programmatic, beacons could be used to track the number of app carrying customers in a space (for example in a rail station). When a certain amount of the adspace can automatically be purchased in that location ensuring a more relevant contextual advertising message. True hyper local targeting.

Ultimately, whichever way beacons are used by brands they must not be an annoyance to consumers. It is better to wait and test the opportunity and find the correct way of using it to have a better more informed relationship with customers.

Written By
Paul McCormack

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