iBeacon set to improve Apple's retail experience

Category: Tech & Innovation
10 Dec 2013
Read time: 4 MIN
The 'micro-location awareness' tool allows Apple to push in-store notifications to consumers' devices as they enter and navigate their retail spaces.

Apple’s flagship 24 hour store on New York’s Fifth Avenue is now home to 20 installed and in-use iBeacons, as Apple exhibits its latest technology offering in the bid for hyper-personalised shopping experiences. Unveiled on 6th December 2013, iBeacon is a “micro-location awareness” tool allowing Apple to push in-store notifications to consumers’ devices as they enter and navigate their retail spaces.

iBeacons pave new way for retail

Initially released in 254 Apple Stores in the US, the technology is likely to be shared in stores in Europe and Worldwide based on the success of this first American release strategy. Unlike GPS technology, which guides a shopper to a store, Apple’s iBeacon only works once a customer is inside their retail space, and functions to enhance each participating customer’s shopping experience by transmitting store facts, information and offers to recognised devices as they pass by each strategically installed beacon.

Using GPS to guide and follow shoppers inside a store is not viable as the technology does not work well indoors, and is not sufficiently accurate to pinpoint a user’s exact location within a room or building. Apple’s micro-location tool, however, uses low-energy Bluetooth (BLE, Bluetooth 4.0) to correctly identify a shopper’s position within a store with ease, requiring users to have both iOS 7 and Bluetooth enabled by the time they enter one of Apple’s 254 US retail locations.

The iBeacon technology is supported by iOS 7 on Apple products from the iPhone 4s onwards, the iPad 3 and above (including the iPad mini,) as well as the iPod Touch 5, OS X 10.9 and up to 10 Android devices, creating around 190m active iOS products currently in use that can be used with - and as - iBeacons. Following the holiday shopping season and China Mobile trading, that number is thought to rise to 250m devices.

The iBeacon transmitters currently employed in Apple Stores across America are programmed to emit and engage specific distances and locations, with some providing push notifications of general information to the Apple Store app store-wide, whilst others are only activated when a shopper is in their exact vicinity - in front of a certain products or demo stand, for example.

This technology was released quietly earlier in the year with the iOS 7 update, and has only now been put into use in stores by Apple. Macy’s, Best-Buy and other retail giants in the US have been using similar mapping and guidance technology since as early as 2010, when Shopkick burst onto the retail scene. The app is activated when a shopper enters a participating partner store, and their mobile device is sent notifications pertaining to offers, ads and deals available within the shop. In 2012, Shopkick drove $200m to its partners in revenue, proving the profitability and market for Apple’s latest release, even more so for the leading computer firm as its geofencing technology is even more specific and customisable than Redwood City, California’s shopping app.

Like Shopkick, San Diego-based wireless technology and innovation firm Qualcomm has also been developing similar micro-location products and services, and announced this week that its Gimbal proximity beacons are available for commercial sale for as little as $5 or $10 per device depending on quantity ordered, and are accurate to within a foot, making them ideal for retail mapping solutions.

Early criticisms of Apple’s iBeacon release have already been heard, which largely centre around the perceived speed with which the technology was implemented in stores without a sufficient development and maturation period. Notable irks surround the iBeacon not working in tandem with all in-store booths, product displays and demo-tables, leaving shoppers with no information or notifications received in entire corners and areas of stores, and for repeating the same notifications in separate locations in the same store, despite being declined and closed previously by users. The iBeacon has also been criticised for the high volume of store information sent to each device, and the lack of special offers and discount codes made available to shoppers using the app on their mobiles, which one can only assume will improve in time as more and more Apple stores develop their offerings in line with this release. It has also been noted that the app is only worthwhile if shoppers are permanently looking at their phone to avoid missing updates, thus making the practice of shopping all the more tedious and time consuming.

Users have already raised security concerns regarding the Apple Store iBeacon system, citing their distrust in being tracked and logged, every step they take in a store. However, as the beacon technology operates on micro-location awareness and not each individual’s actions, the app does not collect or log information about shopper inside their retail spaces. Each iBeacon transmitter and receiver picks up on any mobile activity near their prescribed location in the store, not who or what is near them. Push notifications received by users of the app are specific to a product, not a person, within the store.

Just as Apple are not the first to develop and unveil this kind of location-based technology, they will certainly not be the last, and Google and Microsoft are just two companies that are expected to follow Apple’s release with their own software update in 2014. Major League Baseball has already expressed an interest in licensing the iBeacon to deploy within its At The Ballpark app to enhance and customise baseball fans’ experiences inside their stadia with souvenir store coupons, video footage and trivia linked to certain locations within a stadium. Apple has also revealed that, depending on how it it configured, any device can act as either a receiver or a transmitter for iBeacon, resulting in huge retail and business opportunities for using iPads as in-store or in-office information transmitters, driving sales and revenue for the technology giant.