In its infancy, GeoFencing was used to direct foot traffic to a store from a ‘fenced’ area. Because of the nature of the GeoFence and the growing availability of high-speed wireless, almost any location can be fenced.
A geo-fence is a virtual perimeter for real-world geographic areas. This has been manipulated into a location-based mobile service which lets marketers send messages to smartphones when they enter a defined area, such as a shopping mall.
A great example of how retailers have used this to their advantage are US based florists 1-800-Flowers, who deployed targeted ads for discounts on bouquets in the days leading up to Valentine's Day. The ads could pop-up in any mobile app being used in a specified area.
The most recent iteration of geofencing comes with the latest iOS 7 release from Apple. Using Bluetooth Low Energy (BLE), iBeacon embraces the third dimension of retail by creating a virtual region which can alert your app when a user enters the region. Beacons are a small wireless sensors placed inside any physical space that transmit data to your iPhone using BLE.
Imagine walking into a shopping complex with an iPhone, approaching a store and having iBeacon transmit customised coupons or even walking directions to the aisle where a particular item is located. It can prompt a customer with special promotions or personalised messages and recommendations based on current location or past history with the company.
BLE is built specifically to consume small amounts of energy and make phone batteries last longer. There are some limitations with BLE when it comes to transferring data. For example, because BLE only supports very low data rates you cannot stream audio.
The iBeacon can also be used to assist staff in recognising when repeat customers are in close proximity. It has the potential to alert the store person to things like buying history and other relevant details which makes interactions a lot more streamlined, and the customer experience more personalised.