Here are my predictions about the beacon effect:
• Beacons transform the real world into a digital channel
• It’s relatively safe since there are multiple steps required for end-users to activate beacon communications
• Consumers expect feature-rich digital experiences in the physical world
• A decrease in semiconductor costs, new mandates in marketing, and consumer adoption will fuel the adoption of beacons usage
• By 2016, beacons will be free to retailers, museums, arenas
• The profit center for beacon companies will be software, analytics, insights and consulting services
• Consumers are “warming” to the idea of trading data for enhanced experiences
• Beacons are low cost and low maintenance, as a result there will be more than 4M devices in use by end of 2018
• Beacon-delivered advertising will generate significant activity in the next 18 months
• Beacon-generated ad space will be widely available via RTB and generate $500M-plus by 2018
• Mobile phone plans will be subsidized by advertising and supported by beacon data
2. The Next Tech Revolution: The Internet of Things
Smartphones and the mobile
Internet were growth catalysts
for consumer activity.
The universal integration of
semiconductors, new forms of
connectivity, and data
collecting/analytics will propel
the Internet of Things into the
wider economy.
3. The Internet of Things: 3 Key Drivers
Semiconductor &
Tech Improvement
• Price reduction and
standardization of key
hardware and software
components
Corporate Strategy
• Integration of data
collecting/analytics in
consumer electronics
and physical outlets
Consumer Opt-In
• Consumer acceptance of
data gathering and
willingness to trade data
for customization
4. The Internet of Things: 6 Main Layers
*
Hardware:
1) Devices that collect data
2) Devices that transmit data
Software:
3) Data storage
4) Analytics
End-users:
5) Integrated applications
6) Acceptance and trust
*Framework is part Morgan Stanley and part Rethink Media
5. Introduction
This presentation delivers insights into a specific aspect of
the Internet of Things that will deliver significant disruption
and enhancements to the physical world via Beacon
technology.
Beacons help to guide customers/users/navigators to
particular destinations, as well as transmit messages based
on proximity.
6. Key Points about Beacons
• Beacons transform the real world into a digital channel
• What the cookie is for online applications/advertising, the beacon is for the real world
• Safety: there are multiple steps required for end-users to activate beacon communications
• Consumers expect feature-rich digital experiences in the physical world
• A decrease in semiconductor costs, new mandates in marketing, and increased consumer
adoption, will fuel beacons usage
• By 2016, beacons will be free to retailers, museums, and arenas
• The profit center for beacon firms will be software, analytics, insights and consulting services
• Consumers are “warming” to the idea of trading data for enhanced experiences
• Beacons are low cost/low maintenance: there will be 4M-plus devices in use by the end of 2018
• Beacon-delivered advertising will generate significant activity in the next 18 months
• Beacon-generated ad space will be widely available via RTB, producing $500M-plus by 2018
• Mobile phone plans will be subsidized by advertising and supported by beacon data
7. Bluetooth LE*
devices transmit
small packets of data
…
What Do Beacons Do?
… Which wake up an
application on your
mobile device
The application triggers
delivery of content,
coupons, offers and info
*Bluetooth Low Energy (BTLE)
8. How Beacons Work
• A beacon is a small, low-powered piece of hardware
emitting Bluetooth Low Energy (BTLE or BLE) signals to
nearby smartphones and tablets
• The beacon signal is a radio wave; it’s not limited by
walls or doors
• The BLE emission can awaken apps on smartphones
(and other beacon-ready devices) within 150 – 200 feet
• This allows for location-based/proximity messaging –
delivered via mobile payments, loyalty programs,
coupons and content apps
• More beacon advantages: it’s cheap and each unit has
a 2 – 5 year battery life
9. BTLE is:
• A new radio/protocol stack,
enabling the Internet of Things
• Designed to be low cost and
easy to implement
• Good at small, discrete data
transfers
• Able to trigger data with/at
local events
What is BTLE?
10. Proximity vs. Location
• GPS provides location data – accurate within 30 feet
• Beacons provide insight and messaging based on proximity data
• Proximity data is based on how close you are to a specific physical location/set point
immediate near far
receiver transmitter transmitter transmitter
11. Behind the Curtain
1
3
2
4
Beacon
BLE Transmission
App
- Send/receive server data
- Display push info
- Controls for user interaction
Server
- Traces apps
- Sends/receives app data
- Checks beacon database
- Checks content database
- Pushes info to smartphones
Content
Database
12. iBeacons
• Apple hasn’t manufactured a stand-alone
beacon device yet; it may not need to
• Apple has built beacon technology into
its devices and mobile operating systems
• Apple reported its devices (from iPhone
4S and iPad 3rd gen forward), if running
iOS 7, can become active iBeacons
• This gives Apple a significant advantage:
200 million iPhones and iPads are ready
to send/receive iBeacon signals
• A small business owner can enable an
iPad to transmit notifications to iPhone
users who enter her/his storefront
13. Beacons for Android
• All Android devices running the Jelly
Bean 4.3 OS are BLE compatible
• Jelly Bean 4.3 devices may only be
used as beacon receivers
• Google has yet to produce a
standalone beacon product for
Android devices
• Androids must have an app running
in the background to detect beacons
14. Who is in the Lead?
Devices Ready
Available on …
96%
• iPhone 4S or later
• iPad3 or later
• Any iPad Mini
• iPod Touch 5th generation or later
• Macs (equipped with at least OS X 10.9
Mavericks): mid-2011 MacBook Air,
Mac Mini, mid-2012 MacBook Pros
29%
Devices Ready
• Samsung Galaxy S3, S4, S5, S4 Mini
• Samsung Galaxy Note 2/3
• Moto G
• HTC One
• HTC Butterfly (aka Droid DNA)
• Google/LG Nexus 7 (2013 version),
Nexus 4, Nexus 5
15. In-Store Analytics
• Beacons deliver approximate data
about when users enter and
exit/linger in an area
• Beacons gather and provide insights
about different levels of interactions
– based on customer proximity and
beacon placement
• Retailers will be able to better
identify customers/new and repeat
visitors
16. What Kind Of Data Is Transferred?
Beacon Values MUSEUM RETAIL
Proximity UUID Museum Shopping Mall
Proximity UUID and Major Gallery within the museum Store within the mall
Proximity UUID and Major and Minor Exhibit within the gallery Specific shelves or product cases
• A beacon uses three customizable values to
identify itself (to make a connection/transmit
data): Proximity UUID, Proximity UUID and
Major, or Proximity UUID and Major and Minor
• An Internet connection isn’t required to activate
the beacon experience – however, a connection
is needed to send content coupons (or other
Sample ESTIMOTE UUID
info) that may be driven by the app B9407F30-F5F8-466E-AFF9-25556B57FE6D
17. Privacy Concerns
• Adoption rate may be hindered by consumer reluctance (concerns
about sharing info with retailers and/or hacking) – for now, Beacon
features (for iOS and Android) are entirely opt-in for customers
• Users must enable Bluetooth on their mobile devices, and download the
retailer’s app, for beacons to transmit to phones/tablets
18. In-Market Use Cases
InMarket has partnered with Safeway to roll
out its beacon technology to 200-plus Giant
Eagle and Safeway stores in Seattle, Cleveland
and San Francisco.
American Eagle Outfitters’ launch begins in
100 US locations, including its primary and
lingerie stores.
19. In-Market Use Cases
Swirl Networks announced the Swirl Exchange for
proximity-based, in-store mobile marketing. The firm is
setting up a private exchange (controlled by the retailer).
A brand request to run ads for shoppers (within a certain
distance of products) is determined by beacons within
those departments. The user experience is a full-screen
mobile ad from a participating brand.
The Golden State Warriors are using beacon tech to
encourage fans to upgrade seats, while at the arena. Fans
in the upper tier levels, "cheap seats," will receive a
notification about lower-level seats available for
purchase. Beacons will allow teams to better manage
inventory and enhance the fan experience.
20. Beacon Marketplace
Form Factor Retail Price Form Factor Retail Price
Source: Fosbury
There are currently more than 30 beacon manufacturers with more coming …
21. General Use Cases
Retail:
• Merchants can deliver
in-store coupons and
manage loyalty programs
• Initiate programs to help
with inventory management
• Malls/stores can use
beacons to introduce
products, brands and other
departments
Sporting & Concerts:
• Promotion of team
merchandise
• Notifications about
food/drinks/other vendors
• Find-a-friend features
• Specific content (behind-the-
scenes footage from the
band or practice/interview
sessions with athletes)
Content delivery:
• Will be a big driver as
entities develop their own
branded entertainment
• Beacons will be a unique
way to push content in
retail environments to build
relationships with
customers as they shop
22. General Use Cases
Airports:
• Provide customers with
maps of terminals
• Notifications updating fliers
about flight details
• Gate updates and details
• Deliver Wi-Fi credentials
Museums:
• Provide visitors with venue
maps
• Additional info about
various works of art/artists
• Wi-Fi credentials
23. Stuff I’ve done:
• Chief Advisor of Digital Media and Innovation for American Association
of Advertising Agencies
• Head of bazaarvoice Media Labs, Intrepreneur
• President at Firefly Video (division of Exponential) Intrepreneur
• Vice President, Strategic Development at Tribal Fusion (division of
Exponential)
• President/Founder Performance Bridge Advertising
• Business Development Director at Ampira Media (formerly FortuneCity)
• Media Planner (Digital and Traditional) at Deutsch and at OMD
Education:
• Investment Banking Institute, Certificate, Financial Modeling/Valuation
• University of Pennsylvania – The Wharton School, Certificate, Wharton
Executive Education, Finance/Accounting for the Non-Financial Manager
• New York University, Certificate, Business Finance
• Saint Bonaventure University, BA, Journalism and Political Science
About Me
Donnovan Andrews
Twitter: @donnovana
Email: donnovan@gmail