Technology + Management + Innovation
Solutions Architecture

Customer Experience Eats Proximity Technology

by Jake Bennett

Proximity technology alone won’t transform retail—it must be used to address customer need in the digital age.

Store, shopping mall abstract defocused blurred background

Proximity technology is a class of emerging technologies (which includes iBeacon, NFC, RFID and a host of others) that enable marketers to pinpoint the location of a customer at a particular point in time. Although proximity technology holds vast potential for marketers, it raises some legitimate concerns as well. Probably the most famous (or infamous) example of the dark side of proximity marketing was in the movie “Minority Report,” which depicted a world where people are under constant surveillance, allowing governments and businesses to track people continuously via retina scanners. In this futuristic landscape, digital billboards identify customers as they pass by and speak to them with highly personalized marketing messages: “Hello Mr. Yakimoto, welcome back to the Gap. How did those tank tops work out for you?”

Fortunately for us, ubiquitous, government-controlled retina scanners don’t exist in the real world. But, an even more powerful and pervasive tracking device does — the smartphone. When paired with proximity technology, the smartphone provides all the computational horsepower necessary to create sci-fi-inspired personalized marketing experiences, experiences that truly add value for the customer rather than creating a dystopian landscape. So if that’s the case, why hasn’t proximity technology transformed retail?

Indeed, proximity technology is at a critical inflection point. Right now retailers are dipping their toes in the water. Most are focused on experimentation, and retailers are still learning the benefits and limitations of the technology. This tentative approach, though, hasn’t created the disruption retailers have been hoping for — a transformation that will lure online shoppers back to the store. Installing iBeacons in a few stores won’t by itself change macro consumer trends. Nonetheless, the question is still hanging out there: Will proximity technology truly enhance retail ROI? Or is it another technology fad that will fail to live up to its promise?

It is too early to tell for sure, but the evidence still strongly suggests that creating a personalized, in-store, digital experience will benefit retail significantly. According to a PricewaterhouseCoopers study, the majority of shoppers in every tracked category, ranging from toys and electronics to clothing, conduct research online before making a retail purchase. What if retail locations could give customers the same level of personalization they receive online?


Solutions Architecture

Proximity marketing has arrived. Here’s the blueprint for creating a one-to-one digital conversation with your shopper in-store today.

by Jake Bennett

Emerging technologies like iBeacon and Near Field Communication (NFC) have opened up the possibilities for unparalleled in-store interactivity with shoppers. The key is staying focused on using this new tech to actually enhance the shopping experience for the customer.


Emerging in-store positioning technologies like iBeacon hold the promise for highly-personalized, “Minority-Report-like,” marketing programs. However, this technology is still at a very early stage. Retailers who adopt the technology first—and are able to execute it brilliantly—will almost certainly gain a competitive advantage. But the challenge is that it’s not entirely clear what experiences can be created today that actually offers a better shopping experience. Much of what the industry is talking about now centers around using proximity technology to offer coupons to shoppers in-store. I, for one, think we can do a lot better than incessantly pushing discounts to shoppers as they peruse the aisle.

At POP, the innovation team wanted to weed out the hype from the reality by building a real, working prototype using today’s technology to create an in-store shopping experience that didn’t suck. We wanted to build something that added value to the shopping experience for the customer and promoted stronger sales for the retailer.

We also wanted to develop the prototype fast. Not in months, but in weeks. We set three weeks as the goal. We know that the rate of change in retail is crazy, and that we have to move at the same pace. So with a big goal in mind and a short timeline in front of us, we started by formulating a game plan. Our idea required a custom solution, but there wasn’t time to develop everything from scratch, so we needed to establish a “Lego-like” architecture: leverage pre-existing pieces and spend our time putting them together. Our technology Lego-set looked something like this:

  • HTML 5, rather than proprietary animation technologies, for kiosk motion video
  • A standard touch-screen kiosk running Windows and off-the-shelf kiosk security software
  • Cloud services via Amazon Web Services
  • Estimote iBeacons (Technical note: For a production system, it’s imperative to choose a beacon vendor with a security layer included, to avoid security attacks like beacon spoofing. We used Estimotes here for ease of deployment.)

Beacon Components Diagram


Everywhere Communication

One of the coolest aspects of beacon technology is its ability to attach the last link of the chain between the shopper and the retail space he’s in. But in order to make this work in a real-world retail setting, you have to get all of the pieces (beacon, mobile app, website and kiosk) to talk together. With that in mind, our team focused on building the communication layer first. That allowed us to prove that the whiteboard sketch could be implemented in practice. The communications architecture employs REST API calls and Web Sockets for the bulk of the inter-component messaging.