Mothercare is the latest company to reveal it intends to use beacon technology in a bid to provide customers with a better in-store experience, although the retailer admits that in doing so it may raise some privacy concerns that will need to be allayed.
The plan was revealed by Harpinder Singh, mobile commerce manager for Mothercare and Early Learning Centre, during a session at the Demandware Xchange ’14 conference in Barcelona, with the retailer expecting to start trialling beacon technology in early 2015.
Beacons are a low energy, low cost Bluetooth technology that retailers have begun to deploy around their stores to interact with customers. The idea is that when a customer moves within a certain perimeter, the beacon sends a signal to their smartphone, alerting the customer to potentially useful information.
Mothercare has more than 200 stores and already engages with customers using mobile apps, which Singh said could link to beacons.
“There’s definitely an opportunity here, and because it’s so low cost we’re definitely going to a trial at the start of next year,” he said.
Singh said one of the aims of the trial would be to find a way to use beacons that is not too intrusive.
“There’s loads of stuff you can do with beacons and it’s a little bit scary how much you can do,” he said.
“We’ve had suggestions where if a customer walks into an area of a store and then leaves and then comes back a few days later then leaves again, that we send them something to say ‘We know you’ve been here, why haven’t you bought something?’. I think we wouldn’t do that straight away,” he said.
Singh said beacons could be used “to provide better product information” and “make the customer feel more a part of the experience”.
“We don’t want to be a brand using scary technology, we want it to feel like when you walk into an Apple store and automatically get a greeting sent to your iPhone.”
Steven Skinner, senior vice president of retail practice for business technology firm Cognizant, said beacons are a powerful tool for retailers.
“Beacons can help a retailer recognise, reward and understand its best customers, increasing loyalty and building a stronger relationship with them,” he told Computing.
“The technology can be used to track how many times a customer visits a shop, the departments where they spend the most time to determine which displays are most effective, and the number of promotions or vouchers redeemed in order to monitor conversions,” Skinner continued.
“The technology also has the potential to let a retailer know when its most profitable online customers are present, so staff can recognise and treat them accordingly,” he added.
However, Skinner warned that some customers would have to be reassured that the technology does not represent a threat to their privacy.
“The main barrier to the potential success of beacon technology is the fact that customers have to voluntarily download and install a smartphone app for it to work,” he said.
“To overcome this, retailers need to educate customers about the benefits this technology offers them, and demonstrate the unique benefits they would not get otherwise,” Skinner continued.
“While the introduction of beacon technology poses challenges, if retailers offer a genuinely beneficial and contextually-relevant experience to customers, they will benefit from enhanced engagement and far greater insight into in-store footfall and customer and staff behaviour,” he added.
Singh agreed that the issue of privacy was “a difficult one”, but said staff are trained to explain why a Mothercare app requires access to information.”With our apps, if there’s any concerns we respond to them in less than a day. We’ll respond straight away with information on what we’re accessing and why we’re doing it,” he said, describing how it’s important not to pressurise customers into using new technology.
“If we were to go into beacon technology, we’d be very careful to go down a route where customers get used to it and we’re not going to use it to send you lots of offers as soon as you walk into a store, because we’ll just end up with customers complaining,” Singh explained.
“It’s definitely a difficult issue and something we want to be sensitive to, especially with our customer base,” he added.