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Ok, so what is it?

It's a proximity system. It means that apps on your smartphone, tablet, wearable or other computing device can respond to fine-grained distance readings from 'beacons'.

Beacons are small, cheap physical devices that you can place around some location to represent the things you want to read distance from.

A user holding a phone within range of a beacon

The term iBeacon is just Apple's branding for their own beacon platform, but there are lots of beacon services & devices, and this is not an Apple-only technology.

See above - that's a physical beacon, and an app responding with a notification because the app's user came into range.

Is that it?

Well, yes and no. Yes, it's just a proximity tool. But no, that's not it!

Beacon advocates explain that there is a whole new layer of user interaction that can be gained with the simple addition of proximity. Skeptics say that this layer doesn't address a core user need, and therefore all the media attention is just a hype bubble.

So who's right?

That's a hard question to answer - the reality is always somewhere between the skepticism and the hype. What we can say is that this technology enables interactions that simply weren't possible before.

The retail industry has been the initial target of media attention. There is a lot of potential here, and already a buzz of activity, in terms of roll-outs, providers and solution services.

However, this is not just a retail technology. It has potential implications for many practices and many industries.

Will this impact me?

Consider this. Are there any people (customers, clients, staff, or others) who already do, or possibly could, interact with your business via:

  • Mobile - including wearables, or any computing device that moves around
  • Physical space - such as a store, gallery, warehouse, cafe, office, etc.

If you answer yes to both, then this technology has the potential to impact your industry.

At least, that's the short-term perspective.

The bigger picture

A longer-term view is that technology landscapes are, as usual, in flux. The emergence of beacons is one component of a trend - the blending of digital virtual worlds and our physical one. It is often said that beacons are an example of the emerging Internet of Things (IoT).

In the IoT vision, the continually decreasing cost and size of sensors, hardware, and network capabilities mean that more and more physical things become represented digitally - they can be queried and updated from remote locations just as we do with virtual services today. As this trend continues, layers of services will emerge to take advantage of these network-friendly things.

The idea goes that the new layer of interaction cited by beacon advocates represents an early example of IoT, and that forward-thinking companies have the chance to invest and play a market-leading role via these technology trends.

What is the new layer of interaction?

Back to beacons - this is about more than just triggering notifications. Let's take a simple museum example.

If your user's app can tell when they are near an exhibit in a museum, then it can pull down a bunch of rich information about that exhibit - text, audio, video, links, similar artifacts etc.

A phone app detects a beacon and looks up related information online

Sounds impressive, right?

But this is actually very similar to what people already do all the time. The highlighted area below shows the part of the interaction that already takes place without beacons.

Phone apps already look up data online - the only change is that now the beacon prompted the interaction

People already routinely use phone apps which then connect to the web. When your user wants to find out some contextual information about something, they can just pull out their smartphone and search for it.

Adding a beacon just makes one subtle difference. Rather than your user taking the active step of searching, your app does it for them passively.

That sounds a bit contrived - how is an app supposed to know when to do that?

This is a key question, and one of the main points of contention in use-cases for this technology. The bigger question is, can we really infer a user's intent?

What we are really talking about is offering some kind of service, based on our user's proximity to something. Knowing what our user is near is only useful if we can also infer what they intend, or what they might otherwise respond positively to.

Personal assistant apps like Google Now are experimenting with techniques to get at the most relevant services for a user's current context. There are a lot of challenges here, and users of these services know that they are at an early stage.

But while this genre of apps continues to mature, there may also be lower-hanging fruit for us to work with.

Coffee & hotels

A couple more (quick) use cases will help illustrate.

#1. Your user is in a coffee shop
There is a beacon under each table. Instead of waiting in line, customers just sit down, order and pay.

A coffee

In a busy coffee shop there is clear potential for convenience.

In this scenario, users aren't really aware of the moment-by-moment interaction in which their app checked in with a beacon to figure out their table number. They are, however aware they had to install the store app and opt-in to the service, and that is why they didn't have to pay at the counter.

#2. Your user is in a hotel
There is a beacon behind the door of each room. When a user gets very close - within a few feet - the door unlocks. That's it.

Some keys

In both of these cases we are on solid ground, because our ability to infer our user's intent is high. If I sit at a table in a coffee shop and open the store app, I probably want to order. If I am next to a hotel room door and I am checked in to that room, I probably want the door to open.

Physical & digital

As discussed earlier in this article, there is a pattern in these use-cases. Digital is merging with physical. Or another common cliché: 'There is no offline'.

It sounds intense - but it can also be liberating. As our devices become more and more aware of our physical context, they are better able to serve by facilitating our physical interactions, rather than luring us off into their separated virtual worlds.

As we walk the path away from solid use-cases where our ability to infer user intent is high, we must be conscious of building apps which liberate rather than constrain, or even just annoy. In the long run, apps that do the latter will lose out to apps that do the former.

The hazy landscape is both a risk and an opportunity. The key to taking advantage of it is a mixture of exploratory, creative vision, and lean, iterative product development. These approaches allow us to imagine, build, learn from real users, and change course in incredibly short time cycles.

What else do I need to know?

There are a few things:

Power

Beacons won't sap your battery. They are based on a new Bluetooth standard which is designed to use very little energy, and to sleep when not in use.

Compatibility

To be able to use beacons, you need the right hardware and the right software on your phone. However, as Forbes point out, this already includes about 200 million devices, and that number will rise quickly as people exchange old phones for new ones.

Privacy & analytics

If an app can tell when you are near something, it can also send that information back to a server where it can be stored. This means companies can capture more data about people's movements and choices.

From a marketing perspective this means segmentation analysis, A/B testing, and various other ways to continually improve your offering. From a privacy advocate's perspective this is a little more nuanced.

The reason is that with competing physical analytics techniques such as WiFi triangulation and Computer Vision, users are completely unaware that their interactions are being tracked.

By contrast with beacons users opt in - usually by downloading an app, enabling Bluetooth and agreeing to the app's data collection policy. And, in order to entice users to keep running apps, developers must offer some kind of clear value.

A changing landscape

Things move quickly in any field in which a technology innovation has backing and breadth like this. There are opportunities and risks here, and this particular technology is one part of a series of emerging trends.

The landscape is changing quickly. Therefore it's important to watch developments and stay open-minded as to their meaning for you and your industry.

This article is just an introduction, and we have plenty more to say - so keep an eye on the insights channel for more articles in the coming weeks.