CROWN JEWEL: Alex & Ani employee Keisy Marcano checks messages on her smart-phone at the retail store in Cranston. The company has adopted new sensor technology called the iBeacon that allows stores to detect, send messages and interact with customer mobile phones when they are in or near the store.
With a device roughly the size of an air freshener attached to the wall, Alex and Ani LLC can detect when customers are nearing its stores and send them positive-energy marketing through their phones.
The Cranston-based jewelry maker this past winter outfitted all 40 of its U.S. stores with Bluetooth Low Energy systems, more commonly known by the Apple Inc. brand name iBeacons, which let retailers communicate directly with enabled mobile phones in close proximity.
What phones have become for navigating city streets, these beacons could soon make them become for grocery store aisles and jewelry display cases.
They can power indoor mapping systems to help shoppers find what they’re looking for and help store managers find shoppers while pushing out rewards and special offers.
“We feel this is just the start,” said Ryan Bonifacino, vice president of digital strategy for Alex and Ani, about geo-location retail technology. “If someone happens to be engaged and [is] doing brand discovery, our best bet is to tell them a story. Sometimes that can be a broad story of Alex and Ani and in other cases it can be very localized.”
During its pilot program last summer, Alex and Ani sent in-store customers messages about baseball that corresponded with Boston Red Sox charms on display at the time.
Eventually Bonifacino said the system will be able to transmit content connected with each product to the customers’ phone when they stand next to that particular item in the store. The content could include stories gleaned from social media in addition to images and product details.
“If you look at peak times like pre-Christmas and Valentine’s Day, you have lines out the door and people waiting to interact with a store associate,” Bonifacino said. “If we give them the power to learn at the display case, we have helped mitigate one of the largest issues in customer experience.”
The beacons themselves, produced by companies such as Estimote, are paired with software from a third-party app developer, which in Alex and Ani’s case is Swirl, also utilized by Timberland and Kenneth Cole.
Shopkick is another popular marketing system, with partners that include a large number of mass-market retailers, and a heavy focus on reward programs. With geo-tracking, retailers can reward customers with points just for visiting the store, even if they don’t buy anything.
Most iBeacon systems, which can locate a phone to within a foot, are focused on communicating with customers already inside the store, but their range can extend out into the surrounding neighborhood.
Diane Santurri, assistant professor at the School of Engineering & Design at Johnson & Wales University, said retailer interest in geo-location sprouted last year when Apple rolled out iBeacon in its latest mobile operating system and accelerated this past winter when it was upgraded. The upgrade in iOS 7.1 allows iBeacons to communicate with phones even when the shopping apps they connect with are closed.
“We are right on the cusp of it taking off,” Santurri said about retail geo-locating technology.
In addition to providing new marketing capabilities, iBeacons provide a wide range of consumer data for stores to analyze, such as movement patterns that can help them adjust floor layout and inform real-time decisions about online advertisement bidding.
But Santurri said after trying out Shopkick recently, she saw the new mobile technology overlapping most with functions associated with retail employees, such as greeting at the door, locating products, answering questions and checkout.
“They are using it to create a personalized digital experience while getting away from having a lot of [employees] in the store to guide the consumer,” Santurri said. “I would say the biggest impact is on employees and not having to check out everybody.”
While the use of iBeacons is starting with traditional retailers, Santurri said the technology has potential at sports stadiums, airports, theme parks or other areas where large numbers of people gather.
Of course, that doesn’t mean every foray into site-specific mobile marketing will be successful or avoid missteps.
Tracking customers raises privacy concerns for some while others may be more aggravated than enticed by unsolicited marketing messages bombarding their phone every time they approach a store.
Not all retailers are jumping on the iBeacon bandwagon.
Woonsocket-based CVS Caremark Corp. is not using iBeacons in its stores, spokeswoman Amy Lanctot wrote in an email. She said the pharmacy chain wouldn’t comment on whether it might in the future.
Meanwhile, Alex and Ani is racing ahead with its mobile marketing.
Bonifacino said since its beacon pilot program began last summer, Alex and Ani stores have not received any negative feedback on “hyperlocal” messaging, with more than 70 percent of customers interacting with notifications.
In the fourth quarter of this year Alex and Ani plans to introduce its own app to utilize iBeacon technology, Bonifacino said.
Asked whether mobile phones will eventually reduce the need for human sales associates, Bonifacino said he doesn’t think so.
“I don’t see the technology replacing people,” Bonifacino said. “Nobody does what we do in-store and there is no way to replace the individual.” •
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