When 28-year-old marketing executive Salih Sheikh moved from consumer advertising into wholesale, his expectation was of retailers aeons behind the technology curve, defiantly clutching their 16-year-old Nokia 3310s. “I reckoned many wouldn’t even have a smartphone, let alone use apps, but my assumptions were completely wrong,” he admits. What he found were people using apps effortlessly, but not necessarily for business.
Now Bestway’s head of marketing, he’s witnessed one of the most exciting roll-outs of app technology to hit the aisles. Since last year, the cash & carry group has been installing ‘beacon’ technology into all 63 of its depots nationwide, to communicate to customers at their convenience and drive promotional sales on a range of platforms, including smartphones.
Welcome to the world of the beacon – a shining light on the high street, but as yet largely untried and untested in wholesale. But what is it? How does it work? And, most importantly, will it deliver results?
The world of beacon technology
Apple unveiled the ‘iBeacon’ back in 2013, but today, beacons aren’t limited to Apple. They are small wireless devices that transmit weak Bluetooth signals to other nearby Bluetooth-enabled devices This ‘pushed’ information can be targeted in real-time at customers with a corresponding app, depending on their proximity.
In retail, beacons feed into the increasing desire for a dynamic customer experience: to guide shoppers through a store, offering them personalised deals and rewards as they go. These may be age-old enticements, but what once worked in the physical world must now reach people glued to digital devices.
“Our industry is being shaped by what is happening in the consumer world, and the cultural shift in habits is already taking place,” says Sheikh.
It’s a view shared by Volkan Atik, sales executive at specialist software provider BCP, who sees potential for beacons over and above the push notifications already being road-tested by wholesalers.
“Beacons are a quick and slick way of engaging with customers. It’s all about personalising the message,” he says. He explains that beacons can be used to give retailers more information about specific products or to alert customers to new products and promotions. They can even monitor customers’ behaviour: when this data is inputted into heat-mapping software, wholesalers can analyse where customers congregate on the premises; this can, in turn, inform where promotions should be placed or used to judge the success or failure of existing promotions.
Finally, because the app itself is customised with company branding, which can be altered to feature seasonal or occasion marketing, it works to reinforce relevance and build loyalty.
How can it be used in wholesale?
In delivered wholesale, there’s further scope for beacons in asset tracking, as Atik notes: “A beacon can be attached to a cage. When that cage moves through the depot to the marshalling area and into a truck, temperature, GPS and time can be recorded. This puts an end to situations like customers claiming food has gone off because it wasn’t delivered on time. It can also be used to track missing cages languishing on customer sites, or used to create a more efficient wholesale operation.”
Early analysis shows that those adopting the technology for promotional marketing are seeing spikes in sales.
Back at Bestway, Sheikh says around 10 beacons have been assigned to each warehouse and app downloads are currently nearing 15,000.
“The app’s purpose is not to increase footfall, but to increase sales. As a test, we put three soft drinks on promotion but only pushed one through the beacon. The test was repeated in confectionery and alcohol. Sales in the products pushed through the beacon went up in volume and value by more than 60% compared to 20% on a standard deal,” he says.
The Today’s Group is also poised to roll-out beacons in-depot. This follows a successful trial throughout its consumer-facing symbol estate and a partnership with retail app provider BigDL.
Mirroring the BigDL offer, the group’s Plan for Profit app is already in place for the trade, showing deals and promotions and an interactive wheel where users can win daily prizes. But, in the months ahead, digital coupon technology and beacons will be added so wholesalers and retailers can better interact. However, the group is keen to stress that the technology will work alongside, rather than replace, more traditional forms of communication.
Success or failure?
Digital business development controller Mark Bottomley says: “We recognise digital is here to stay, it’s not going anywhere, so it has to be part of retailers’ path to purchase. Beacon technology gives us a way of interrupting the retailer at the point of purchase, informing around promotions and new products, and really delivering on the impulse opportunity.”
So far, anecdotal response is that the technology is seen as an accessible investment for suppliers wanting to push product, and for wholesalers and retailers. Bottomley also reports no problems with connectivity or technical failure, a point backed up by BCP.
Perhaps one problem area could be the annoyance factor, which the Today’s Group says it is mindful of when it comes to its digital strategy.
“We manage the alerts so users are not overloaded by seeing them too often or by seeing the same alert multiple times,” Bottomley says. “We’ve tested it and we know consumers and retailers are happy to be interrupted by offers relevant to them. We don’t have to persuade people to turn on their Bluetooth either. Deal-hungry, digitally savvy retailers who have downloaded the app will keep their Bluetooth on.”
Attract the right customer at the right time
But like every technology, it’s about tailoring the right offering to the right customer at the right time. Advanced personalisation is the next step for Bestway, which is in the process of using the beacons’ monitoring function to map out a specific retailer’s shopping journey.
Sheikh says: “Based on previous shopping habits, we can map out a retailer’s quickest depot route, while showing them what to buy first. For example, heavy items like alcohol at the bottom of the trolley, and tobacco at the end, so there’s a reduced risk of it being stolen. Here, we can really build customer loyalty.”
For other wholesalers starting on their tech journey or perhaps only considering the value of beacons, Bottomley provides a reassuring message. “Everybody recognises this is new and there has to be a leap of faith. It’s uncharted territory and we don’t know how successful it’s going to be, but by making this technology accessible for suppliers and members, we are getting traction,” he says.