Proximity marketing enables tailor-made messages at the point of sale

Smartphone shopping supermarket

By using mobile technology, retailers can target devices known to be in a particular area with personalised adverts and promotions

Considering that the vast majority of consumers are said to buy the same groceries every week, brands and retailers have an obvious challenge on their hands when it comes to encouraging shoppers to pick up something different. Produce Business UK investigates how the latest applications of mobile technology could help

Proximity marketing is just one solution available to retailers and therefore gaining increasing traction at the moment. It enables stores to directly communicate with their customers via tailor-made, personalised notifications and offers at the point of sale – where a high percentage of shoppers still make their purchasing decisions.

Defined as the ‘localised wireless distribution of advertising content associated with a particular place’, proximity marketing works by targeting devices known to be in a particular area. In doing so, retailers can interact more with their shoppers via specific advertisements, while, at the same time consumers, are no longer passive or simply receiving stock messages.

Retailers can also use proximity marketing to communicate product ratings to consumers. “People trust other consumers more than they do brands,” says Craig Smith, founder of blog retail-innovation.com and a director at REPL Digital, a UK-based company that supports over 50 retailers globally with their digital in-store strategy and execution. “When the technology enables it, you’ll see more data in stores, like you do online, with product ratings.”

Smith points out that there’s already “quite a lot happening” in the UK in terms of proximity marketing, and pinpoints the personalisation of marketing as one of the two major disruptive digital forces at a retail level – the other being digital payment.

Transmissions can be received by shoppers in a particular location who wish to receive them and have the necessary equipment to do so, and their devices can be targeted via four different mechanisms:

1. A mobile phone being in a particular cell;

2. A Bluetooth or WiFi-enabled device being within range of a transmitter;

3. An internet-enabled device with GPS enabled to request localised content from internet servers; and

4. An NFC-enabled phone that can read a RFID chip on a product or media and launch localised content from internet servers.

While Bluetooth has “been around for ages”, Smith believes recent improvements now make it a more feasible option for proximity marketing. “The introduction of Bluetooth low energy in the most recent iPhones and Android smartphones means it doesn’t drain your phone’s battery,” he says. “You can have it [Bluetooth] switched on all the time and brands can reach you wherever you are.”

NFC technology could also prove particularly useful for grocery retailers, according to Smith. “When consumers are shopping for fruits or vegetables they’re often curious to know the difference between the varieties and range, as well as where the product’s grown and its nutritional benefits,” he points out.

“A retailer could allow shoppers with NFC-enabled phones to present their mobile phones against an RFID shelf barcode to find out more information about that product.”

With GPS, retailers can make use of consumers’ in-built location technology too. “Google, and the like, know where you are going, so retailers can find out which places are getting busier or quieter,” Smith points out.

“For example, Telefónica has developed Smart Steps which [by aggregating mobile data] gives hour-by-hour insight into crowd movement and what types of consumers are in certain locations. It could help put your business on the map or could effectively measure a marketing campaign’s success.”

Guatemalan trendy footwear store The Meat Pack has also put GPS tracking technology to clever use. To promote a new discount it created Hijack, an enhancement for the company’s official consumer app. Using GPS tracking technology, Hijack was able to recognise any of its users entering the official store of one of the brands sold at Meat Pack and trigger a special notice with a promotion to give consumers the chance to earn to earn discount.

Another less-well-known mechanism for proximity marketing is beacon technology, which Smith believes is 12 months behind QR codes and set to become actively used in another year or so.

“Not a lot is happening at the moment,” he claims. “It’s been overhyped. In technology, there’s a chart called the hype cycle, developed by Gartner, that charts the maturity, adoption and social application of specific technologies. At the moment beacon technology is in the ‘trough of disillusionment’ because it’s not really been mass adopted.”

In time, Smith says UK businesses will realise the commercial benefit of beacons, just as QR codes are now slowly showing some real usage. “Beacon technology retailers can allow customers to tap products with their smartphones to find out more about them,” he explains.

“House of Fraser is using mannequins to supply information to shoppers via beacon technology. Carrefour in France also has shelf-edge labels that you tap with your phone to find out more about products.”

McDonald’s fast food restaurants in Georgia, the US, have also been trialling the delivery of coupon offers, alerts, employment opportunities and customer surveys via beacons placed in the restaurant.

Facebook in the US, meanwhile, is helping retailers to capitalise on beacon technology, for free. The launch of its new ‘Place Tips’ functionality gives users a “tip” notification when they launch Facebook inside a participating retail store. When users tap it they can view a series of cards about the store.

With Smith claiming technology to be the answer to making every store great, and staff more productive, now is a good time to start considering all of the available options more carefully.

Follow Craig’s latest digital innovation posts on Twitter: @craigwsmith

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