The IoT, retail and beacons: how they all tie together

Published on May 11, 2015 by Jan Schulte



The Internet of Things is one of the hottest topics right now – not just in IT, but in areas as diverse as retail, manufacturing and healthcare.

This doesn’t come as a surprise – the IoT will dramatically change our world in just a matter of years. Therefore we started a IoT initiative to provide Ibeacon enhanced mobile apps with magnolia as backend to provide powerful blueprints to start your own IoT projects. This post gives you the needed background information about the underlying principles of customer engagement with IBeacon enhanced mobile apps.

 

Retail and the IoT

So let’s see how traditional retail businesses can benefit from the IoT by combiningthe digital with the offline world. Retail has changed massively throughout the past decade. Many of the smaller players vanished and were replaced by retail chains or pure online retailers. In the last five years, the pressure on bricks-and-mortar retail has increased drastically, as the industry has shifted more and more towards online shopping.

Online retail has always had access to vast amounts of customer data, allowing it to offer automated personalized offers to customers. Now the IoT can help bricks-and-mortar retail stores to introduce the same automation capabilities, with smartphones playing a key role in it as all the relevant sensors are already in place.

When IoT is used well, it can bring customers who left bricks-and-mortar for web stores back to retail stores by providing strong personalized incentives.

“So how this is done?” you ask. Let’s have a look at some case studies and at how to implement a full solution on your own.

 

Engaging customers with beacon technology

More and more retail businesses have started working with beacons. Beacons are small wireless devices that constantly send a low power bluetooth signal, allowing mobile devices to detect proximity to those beacons. This opens unprecedented opportunities to provide personally addressed, context relevant information.

There was great hype when apps started to go mainstream, but now the apps market is overcrowded. According to an SAP report, 78% of enterprise mobile apps are abandoned after the first use, while one in five apps is used only once. To stay relevant, personalized, contextualized push notifications must be served to customers to be noticed.

Single beacon focused solutions are not enough for sustainable success. A digital business platform is needed to integrate other tools: marketing, online sales, retail store sales, POS, CRM and ERP. Only a fully integrated solution gives you manageable control, access to actionable insights and the right tools to engage customers. That is why Magnolia is the perfect solution.

 

 

Putting it into practice: using beacons to engage your customers

It all begins with beacon management. First, you need to decide what interactions should happen in your store, and where. You have to locate your beacons and manage the proximity range in which events should be triggered on the user’s mobile. For example, a beacon near the entrance might trigger a welcome message to people who enter the store.

 Typical actions that are used in stores include:

 

  • Analytics
  • Messages
  • Coupons
  • Bonus systems
  • Product information

 

So let’s have a look at those different actions: What do they mean? And how do they impact your business?

 

Analytics

Beacons used for analytics don’t trigger an action that causes a visible event on the  customer’s device. Instead, data is gathered, such as how long customers spend in different areas of  the store. These in-store analytics allow you to measure which areas attract most people and which parts could potentially be improved.

 

Messages

Messages are used to welcome the customer or to provide information on special offers or upcoming events. For example, in a grocery store there could be information on discounted fruit. This event gets automatically updated as soon as the ERP detects that the stock inventory is too big and that the expiry date is approaching. Another example is in a remote control store, where a customer could receive a notification about a brand new product arrival. As soon as the user is authenticated on the app we can send personalized messages based on recently purchased items.

 

The power of coupons   

Coupons have proven to be an extremely powerful sales enabler, with whole companies (think: Groupon) being built on this mechanism. By bringing coupons to a user’s mobile, you can achieve much higher conversion rates without going down the costly route of a third party vendor.

 

 

 

Magnolia brings you coupon support straight out of the box, with an app that allows you to manage your coupons. Even QR-Code generation is already included. This means that when a user claims a coupon, they can present the QR code directly at the cash register, where it can be scanned. The good thing is that this extra information allows you to come up with even more personalized content in the future.

 

 

Product information

Product information can also be a great sales enabler. Products that are of a more complex nature can be sold better when extra information is offered. Just place a beacon near a product booth, set the beacon range to 0.2 meters, select a dedicated micropage from your Magnolia instance, and you are good to go.

This could work with explaining technology products, or even when describing how to set up electrical products.

 

 

Bonus systems

Gamification and bonus systems also allow you to increase customer loyalty. With beacon technology, you can provide bonus points every time a customer enters your store. You can give small incentives for spending a certain amount of time or money in the store. You’ll be surprised at how much attention your store will get for a little extra swag.

 

 

Writing a mobile app can be an expensive task. Magnolia has lowered the barrier by giving you a beacon enabled sample shop implementation based on Ionic/Cordova. All the hard parts are already solved for you, so you can use this as a blueprint for your project. All you need to do is to customize it – and you are ready for Android and IPhone.

You can find documentation for our implementation as well as GIT access to the sources under: https://wiki.magnolia-cms.com/display/DEV/Building+IoT+enabled+mobile+apps

 

 

Comments

Matteo Pelucco on 12 May, 2015: That’s cool. Really cool! I need a demo of that at #mconf15 !!

Jan Schulte on 12 May, 2015: You will get one and more!           

Jan Schulte on 15 May, 2015: Please have a look at: https://wiki.magnolia-cms.com/display/DEV/Building+IoT+enabled+mobile+apps for further documentation on the SmartShop app and GIT access to the blueprint sources!



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About the author Jan Schulte

Jan Schulte is a Magnolia consultant. He joined Magnolia 2013 after working for various big IT companies as a consultant, software architect and team lead. He is supporting customers in all kind of tasks and projects. Additionally, he is also regularly involved in pitches and is currently driving Magnolia's Internet of Things initiative. He has 8 years of Java, web development and consultancy experience.


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