In a world of technological advancements that can lead to a serious case of consumer information overload, two mobile technologies are emerging as the front-runners in the race to successful shopper engagement: Bluetooth Low Energy (BLE), also known as Beacons, and Near-field communications (NFC). Both technologies are capitalizing on emerging consumer behaviors that includes a dramatic uptick in the amount of consumers who stay connected to the internet while they shop in brick-and-mortar stores, which has doubled since 2013.[i]
JLL Retail experts Michael Hirschfeld and Aaron Ahlburn, speaking today in the International Council of Shopping Centers(ICSC) Coca-Cola Happiness Lounge in Las Vegas, explore how retailers and shopping center owners, who are seeking ways to increase in-store sales, customer attraction and retention, can use a combination of mobile technologies like BLE and NFC to achieve different objectives within their retail space.
Beacons Electronically Boost Retail Sales Directly to the In-Store Customer: BLE, or Beacons, pinpoint where shoppers are in a store, how long they have been in a particular location and how often they visit. If included in a retailer’s merchandising strategy, and placed throughout the store as digital touch points on shelves, signs and product displays, Beacons can match shopper needs to goods. The ability to track the approximate location of a specific shopper in a store opens up a host of possibilities for bricks and mortar retailers.
“Being able to communicate directly with consumers the instant as they walk past an item is a vital advancement for retailers. It’s what will set using Beacons apart from traditional couponing methods, there’s no bargain hunt involved it’s all a triggered push method,” said Michael Hirschfeld, SVP of JLL’s National Retail Tenant Services group. “We expect Beacons to become widely used, particularly in grocery stores and fast-fashion retailers. Imagine walking past a box of pasta and instantly your phone buzzes with a coupon and a recipe for a 10-minute dinner, suddenly something you hadn’t considered buying makes sense.”
NFC and Barcode Technology Makes Checkout Simple:While Beacons can bring an idea about a need for a particular good directly to a consumer, it is NFC technologies that simplify the transaction at the point of sale. NFC is an ultra-short range wireless communication technology that enables one-to-one communication between devices. What makes NFC technology different is that it’s based around a shopper’s decision to streamline payment by waving their smartphones in front of an NFC-enabled reader.While NFC technologies have been used effectively globally, few U.S. retailers have had adopted it given the technology is a large investment for both smartphone manufacturers and retailers. Alternately, many retailers are using barcodes until NFC adoption becomes widespread.
“Mobile payment technology has come a long way in the few short years it’s been on the market, and we expect that NFC payment and barcodes to continue to lead the pack,” added Aaron Ahlburn, Director of Retail and Industrial Research at JLL. “This technology allows consumers to bypass the checkout line, and makes it easy for a store associate to check them out anywhere. That’s huge for retailers trying to compete in today’s fast paced world.”
While there are distinct advantages to BLE and NFC technology, neither one is a one-size fits all application. Retailers and shopping centers will need to examine how these tech tools can fit into their overall customer engagement strategy and deploy them where they best fit the company’s goals. If used correctly, these digital touch points will incentivize shoppers to head to a store and may ultimately combat loss of sales to online merchants.
While use of technology is crucial to creating a competitive advantage, and getting in front of these technologies can ultimately lead to downstream success, don’t count out the need for staffing just yet; customer interaction is still vital and essential to the selling experience. The big challenge for retailers is going to be melding technology and traditional methods. We expect a trial and error period during the next few years, as many retailers try to figure out the balancing act of engagement opportunity against consumer privacy.