Out-of-home sector debates a future with beacons
Tiny tech: Proxama's Gavin Talbot shows off a beaconThe world's oldest advertising medium is embracing one of its newest technologies, and the result - if the industry can pull it off - could spark a marketing revolution.
The out-of-home sector had its gaze on a rather modest-looking piece of tech this week; a small cube enabled with bluetooth, known simply as a beacon.
A relatively new bit of hardware, a beacon is able to tell a smartphone exactly where it is, allowing for an app to act upon this information.
Many people first heard of beacon technology after Apple, without much too much fan-fair, released its iBeacons protocol in 2013. Since then companies dedicated to experimenting with the tech have sprung up all over the world.
The most obvious applications to date have been to place beacons in retail stores, sports stadiums and, more recently, on transport networks. The idea is that consumer engagement can be encouraged and rewarded through interaction with the tech.
So, for example, a drinks brand could offer a deal via a beacon-to-smartphone interaction whilst at a football match, or an app could reward a consumer with a special offer when they approach a nearby store.
More recently, Google has followed in Apple's footsteps and is developing its own 'proximity tech'. Google's Nearby gives real-world objects their own URL - from a bus shelter to a parking meter - allowing for simple interactions to be made.
And where Apple and Google go, everyone else must follow. In this case, it is the out-of-home advertising sector.
"Location-based marketing revolves around you," says Gavin Talbot, commercial director of Proxama, a business specialising in 'proximity marketing'.
"It works between zero and 50 metres and can be placed outdoors, in a TV, on a bus...and it's extremely accurate and knows precisely where I am. It can also awake apps and broadcast URLs.
"The opportunities for brands are huge."
It also seems likely that mobile users are only set to increase their bluetooth usage; already around 67% leave it on, but when the next Apple iPhone ships it will no longer have a headphone jack - opting instead to use bluetooth to transfer sound to wireless headphones.
"More people will have bluetooth switched on and more devices are going to be using the tech as a result of this move," says Talbot. "The iPhone will ship with bluetooth enabled as a default setting and there seems to be a general acceptance that beacons are going to play a bigger part in our daily lives."
This has got the out-of-home sector excited. So much so, that a host of OOH businesses - including Primesight, Airport Media, Exterion, Ubiquitous and Mobile Media - have launched a 'beacon network' to help adopt the tech and accelerate the opportunities for clients.
"We want to better understand the opportunities that beacons create for our advertisers and that opportunity is being realised now," says Mungo Knott, marketing and insight director, Primesight.
"There are around 2,000 beacons already being incorporated into out-of-home facilities and environments across the UK - and given the sector already reaches 98% of the population, we see out-of-home as a natural fit for their proliferation."
As with the adoption of any new technology, there are some problems that industry will have to find solutions for if beacons are to really take off. For starters, as Seamus McAteer, vice president New Ventures, Neustar, points out, there is a far reaching analytical challenge.
"The data can be very granular. It has to mix macro and micro data. It has to be linked with associated metadata. It's complicated."
Dan Calladine, Mike Anderson, Seamus McAteer, Helen Keegan and Shaun Gregory
Placing beacons - perhaps in their hundreds or thousands - also requires a huge amount of mapping to monitor, control and measure. This is resource heavy, but it becomes an even bigger challenge when the beacons are moving, such as in taxis or on buses.
However, McAteer says overcoming these challenges will be worth it, because - once done at scale - he can see it leading towards a new era of predictive analytics, which could spark a second gold-rush.
But it does need to operate at scale if the industry is to fully adopt it - so what constitutes the critical mass to make this worth the time for agencies and clients?
Dan Calladine, head of media futures, Carat Global Management, says it depends on what you're trying to sell.
"It's a cost-benefit equation," he says. "Beacons might not be the most effective way to sell something cheap, like beer. However, if you're selling a car, and want people to take a test-drive, then it could be worth your while."
Calladine argues that you'd never reach vast, broadcast-level audiences using beacons - "but you could reach smaller audiences of tech-savvy, curiously-minded people, and there are clients that are keen to direct people to a very particular place, and that is why beacons is so interesting."
The consumer buy-in
Some OOH experts are keen to experiment, but urge the industry not to see beacons as an isolated network.
"It should be complementary to out-of-home advertising," says Shaun Gregory, CEO, Exterion. "We need to ask: 'where does this add value?'."
Gregory warns that beacons should not be used as a network that mindlessly pumps out messages to consumers. "That is unintelligent," he says. "However, it becomes very interesting to me if we can use the data to make the advertising smarter."
Others agree, and argue that it will be crucial that beacons are not used as an isolated channel; instead they should be placed in the context of so-called omnichannel marketing.
This should be linked to a well-considered strategy to secure consumer buy-in - and everyone Newsline spoke to agrees. With ad-blocking on the rise, the challenge will be to ensure solid consumer benefit that creates genuine value.
That isn't just the offer of a discount, or an enjoyable mobile engagement - but a simple and elegant user experience with the highest regard paid to privacy and reward.
To find out more about our industry debates, visit the events website. Next up: Dmexco and the Future of Newsbrands.
Follow us on Twitter: @MediatelNews
Mediatel operate two essential services for the OOH industry. SPACE is a collaboration between IPAO and Outsmart and is the most comprehensive and up-to-date list of inventory in the UK. The RouteAPI is a SaaS solution that enables easy integration of Route audience data into client's systems. See mediatel.co.uk for more information.