By adaptive - June 27th, 2016

iBeacons have become key tools for proximity marketing, among the sharpest weapons that brick-and-mortar retailers have for developing digital engagement with customers. London's poshest shopping venue wants its iBeacons to engage visitors, without sniffing their data. Can it work? Brendan McNally finds investigates.

The promise and challenges of iBeacons are being tested in shops located in one of the world’s most prestigious shopping destinations, London’s Regent Street.

The governing board of The Crown Estate, which manages properties owned by the British Monarchy, has installed the beacons along Regent Street, the historic, mile-long, avenue of high-end storefronts in London's West End.

They want to use beacons to help create a personalized shopping experience for the more than seven million visitors who shop the there each year, but it had to be done without tracking them or taking any personal data from them in the process.

They turned to autoGraph, a Seattle-based company known for coming up with ways to develop customer preference profiles which are both highly accurate and done without ever prying personally identifiable information from consumers’ devices.

AutoGraph's strategy is deceptively simple. Shoppers who wish to engage with Regent Street's beacon network download an app that then asks them to answer a series of questions about their taste preferences. Stacey Anklam, autoGraph's Chief Operating Officer, puts it this way: “Our belief is that if you walk up to somebody and ask, 'are you a Mercedes driver or a BMW driver?’ They'll tell you what they prefer and allow you to get an understanding of what interests them without you having to 'sniff their data exhaust.’”

If you can get them to answer enough questions, says Anklam, then you can build up an amazingly accurate profile, about the food and clothes they prefer as well as their attitudes toward money and banking. “That is our core,” she says. As the customer strolls down Regent Street, their smartphone is receiving signals from all the different nearby shops. The installed app uses the autoGraph profile to determine which messages might be relevant to the customer.

“The retailers are using this in all kinds of interesting ways, says Anklam. “There's one restaurant that runs three to five messages at one time, each aimed at different target audiences. “

Since Regent Street retailers are almost entirely high-end shops, many will have beacon networks of their own inside their stores. But these will only reach the customer if he or she already has their particular app downloaded. But this is largely outside the Regent Street app's purview. “The Regent Street app offers news and events to enhance a customer’s experience on Regent Street,” says Anklam. “It's not about 20 percent off. That's not what Regent Street does.”

David Shaw, who manages the Regent Street portfolio for the Crown Estate, says their desire is to create an experience that delivers across all the platforms that appeal to 21st Century shoppers. “We want Regent Street to continue to evolve as the world's most successful shopping destination, which means bringing together online, physical and mobile retailing and using the latest technology.”

Ultimately, Regent Street's beacon strategy isn't about selling goods, it's about visitor engagement. While they want their London customers to keep visiting on a regular basis, when it comes to visitors from abroad, the idea is provide content that will engage them at home so they'll actively plan their visits, often months in advance. 

Anklam says Regent Street regularly stages events that will draw in visitors, which often allows them novel opportunities to find new uses for beacon deployment. Often when they have events in which celebrities participate, they'll have them circulate among the crowd with a beacon in their pocket that broadcasts their location so that customers with the app on their smartphones will find out when they're nearby. 

Other times, they've staged vintage car shows there on the streets and will have the cars themselves rigged, sometimes with numerous beacons, each giving messages about specific parts and aspects of the cars. “People always assume beacons need to be fixed to one spot,” says Anklam. “They don't have to be. That's what makes them so perfect for the events we like to stage. It's amazing how they can increase the fun.”

It's been nearly two years since Regent Street's beacon network was first rolled out. Anklam claims they are successful. She says they know for a fact that visitors who use the app on their smartphones stay longer and spend more money on food, which generally indicates that they've also spent more money on retail goods.

She says autoGraph’s “no data sniffing” approach will probably be replicated elsewhere, particularly in the rest of Europe, where privacy measures are becoming the rule. The courts have ruled that individuals have both a right to privacy, and a right to be forgotten. If beacons are to become a fixture of shopping and other venues, then such an approach will likely have to be adopted.

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