‘This is your coffee calling – buy me’; British high street prepares for latest iBeacon technology

February 14, 2014 8:02 pm

‘This is your coffee calling – buy me’

By Daniel Thomas in London and Tim Bradshaw in San Francisco

Cakes that send smartphone messages to passing hungry shoppers will soon be on the shelves of coffee shops as the British high street prepares to adopt one of the latest US technologies.

A shopper walking down a supermarket cereal aisle could be pinged with details of a special offer on cornflakes. Someone standing at the counter in a café might be sent a message tempting them to buy a cake.

The “iBeacon” technology, which was created by Apple, allows retailers to “push” tailored messages to a customer’s smartphone. It uses precise location tracking to target would-be purchasers when they are in exactly the right place to buy the product.

Eat, the chain of London-based sandwich shops, has agreed the first trial of iBeacon, using a system devised by Weve, which is backed by the UK’s largest mobile telecoms groups. Several other fashion and food retailers are close to signing up to the trial in the next few weeks.

It is the first time this technology has been used commercially outside the US, where Apple and retailers such as Macy’s are already “nudging” customers through their phones.

The technology came to prominence during last month’s Super Bowl. American football fans in New York’s Times Square and New Jersey’s MetLife Stadium received notifications on their iPhones informing them of in-store signings by former players and special offers.

On Friday, Major League Baseball’s Advanced Media division announced that iBeacons will be installed in 20 stadiums before the beginning of the season next month. Users of MLB’s At the Ballpark app who opt into the scheme will be greeted with information about the day’s game as they enter the ground and shown special offers as they approach stores and restaurants.

“We can say definitively that you are in the ballpark,” said an MLB spokesperson.

Special sensors detect when a smartphone is within inches using the latest Bluetooth technology, meaning retailers can track customers as they walk through a store. The technology is sure to raise privacy concerns, although customers will need to download the app and choose to share information. .

The iBeacon can tell you about the soup of the day or a special offer on your favourite cake, said Sean O’Connell, a director at Weve, the group set up by Vodafone, EE and O2 to market schemes. The group has access to the anonymised personal data of 22m smartphone users.

“We have been thinking about how to digitalise all those bits of plastic and paper in your wallet or purse – and then make them come to life using time, location and proximity offering emotion and reward for the customer,” Mr O’Connell said.

“The retailer will know that you are standing in a cake aisle, triggering a message to be pushed your way. But we also know where customers come from and why those customers turn left rather than right – we can profile users in a lunchtime context.”

Weve will use this technology to provide retailers with the ability to market offers to customers they know are interested in a specific service – the technology can interact with the vast database held on customers that includes information such as gender, age and area of address.

Mobile operators also operate schemes where customers can provide more information such as interests and preferences to allow more precisely targeted advertising and offers.

The technology that allows the shelf in a retailer to talk to the smartphone will link with a loyalty service called Pouch, a smartphone app, which will track purchases and offer discounts – for example, progressively cheaper food for returning customers, or specific offers on favourite things at certain time of day.

Weve already quietly had trials of some of the loyalty elements of the scheme with large retailers last year. More than four-fifths of customers in the trial said they would use the digital loyalty scheme again.

In the US, Apple remains the largest user of its own technology after installing iBeacons in all of its 254 retail stores. People who have downloaded the Apple Store application receive notifications about their Genius Bar appointment or are prompted to see whether they are eligible for an iPhone upgrade when they loiter near the stand demonstrating Apple’s flagship device.

Other US retailers are starting to catch up, as iBeacons appear in dozens of supermarkets such as Safeway, clothing stores such as American Eagle Outfitters and boutiques such as Alex and Ani, a jeweller.

Transmitters used to communicate with Apple devices can also push notifications to apps on other handsets that use the Bluetooth Low Energy standard, including several recent Android devices.


About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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