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Beacon Technology: Why the Market is Booming

Beacon technology is nothing new. It has come a long way since 2013, when Apple first introduced iBeacon technology. Today, smart bluetooth beacons are used in many industries around the world – and demand is rising to record levels. 

According to a new research report, the global smart beacon market generated more than $3 billion in 2020, and is expected to reach a whopping $103.94 billion by 2030, growing at a CAGR of 37.70% from 2021 to 2030. 

But what has caused this rise in demand? What are the market trends? And what new opportunities are there for businesses with apps? Read on to find out more.

What is beacon technology?

First and foremost, what is beacon technology? A smart beacon, also known as ‘bluetooth beacon’ ‘BLE beacon’, or just ‘beacon’, is a small, wireless bluetooth device that transmits a signal that other bluetooth devices such as smartphones can ‘see’.

The beacon isn’t transmitting a random signal. It’s transmitting a unique ID number that tells the listening device which beacon it’s next to. When in range of a beacon, the smartphone app will read the beacon data, see what action is assigned to the data and perform the action. 

How does beacon technology work?

The action can be simple, such as showing a notification with a coupon for a product the user is close to, or displaying in-app content with a description about an event nearby. Or it can be complex, such as calculating the user’s location based on their proximity to a beacon

For example, when a retailer installs beacons in their shop, they all have unique IDs registered to their dedicated app. The ID can trigger the app to perform any action the retailer has assigned to it. Or be used to gather user analytics to understand how to optimize a specific space.

Many businesses use beacons in conjunction with geofencing to build their location targeting campaigns. You can find out more about this in this handy guide.

iBeacon, BLE and other terms explained

There are various types of beacons and connectivity.

By standard type, the market is divided into iBeacon, Eddystone and others. The term iBeacon and beacon are often used interchangeably, however iBeacon is the term for Apple’s technology while Eddystone is the name for Google’s, both of which are compatible with mobile apps running on both iOS and Android.

In terms of connectivity, this is segregated into Bluetooth low energy (BLE), Wi-Fi and hybrid. Bluetooth low energy is a form of wireless communication designed for short-range communication. It’s very similar to Wi-Fi in that it allows devices to communicate, however BLE saves battery drain, has a lower range, and transmits less data.

So, BLE beacons as the name suggests are beacons that communicate via Bluetooth low energy technology. The majority of beacons used today are BLE beacons.

The use of beacon technology for proximity marketing

What are the benefits of beacon technology?

A variety of industries including retail, transit, education, hospitality, finance, travel and more all leverage beacon technology to track and communicate with consumers.

The benefits of the technology are many, here are just a few:

Proximity marketing 

Beacons set up in shops, event locations or any public place allow businesses to track the exact location of a consumer at any given time, and deliver targeted notifications for deals, discounts and offers. What’s more, when properly implemented, beacon technology allows businesses to understand more about their users’ behaviour and ultimately use that proximity data to offer a more personalized experience. 

Indoor navigation

Beacons can be installed in large venues such as hospitals, shopping malls, airports and stadiums, to enable indoor navigation for users of those venues. This can be especially useful in settings such as healthcare, where staff spend many hours of precious time giving directions.

Other benefits of beacon technology:

  • Occupancy monitoring 
  • Asset tracking
  • Contact tracing
  • Loyalty programs
  • Advanced data gathering
  • Mobile ticketing

Why the beacon technology market is booming

Now we’ve had an overview of beacons, let’s talk about why the beacon technology market is booming. Upon the release of iBeacons in 2013 there was plenty of promise, yet beacons didn’t take off as expected. The technology itself has lots of applications and potential, however some functions have only become available as the technology has advanced.

The impact of Covid-19

The Covid-19 pandemic impacted the growth of the smart beacon market due to the lockdown imposed by many governments around the world. What’s more, a disruption in the production of electronics further hampered smart beacon sales. However, smart beacons are now being increasingly utilized, especially in the healthcare industry, to prevent the spread of the virus.

Smart devices & in-store-marketing

A rise in advanced communication technologies, a surge in the adoption of smart devices, and an increase in proximity marketing investment are some of the main drivers of the global beacon market. The adoption of in-store marketing by retailers is increasing at a rapid pace, as is the use of bluetooth-equipped devices such as smartphones and wearable smart watches.

Emerging economies

Furthermore, new hypermarkets, department stores and supermarkets are opening in emerging economies, complete with digital ecosystems that push retailers to use beacons and other location-based technology such as geofencing to make their stores smarter. 

smart beacons used in supermarkets

A cost-effective solution

The relatively lower price point of Bluetooth-based solutions is also playing a big role in their large-scale adoption in various domains such as indoor navigation, worker security, elderly care, affordable asset tracking, mobile ticketing and much more.

Beacon technology market outlook 2021-2030

According to a recent research report by Allied Market Research, the global smart beacon market is set to experience huge growth, and is expected to reach $103.94 billion by 2030.

A rise in organized retailing such as supermarkets, department stores and hypermarkets is expected to create the most lucrative opportunities during the forecast period. Followed by hospitality, banking, healthcare, education and transportation & logistics.

(images courtesy of Allied Market Research)

There has been a surge in demand for beacon technology

Region-wise, the market trends show North America as dominating the market, followed by Europe, Asia-Pacific and LAMEA. This is due to large-scale adoption of the technology, backed by high penetration of mobile devices.

In terms of the market segment, Bluetooth low energy is expected to dominate, with iBeacon leading the way in standard type. By offering, the hardware segment will hold the dominant position throughout the forecast period. However, a lack of technological resources and concerns about privacy and security are noted as market restraints.

Smart beacon technology is on the rise

To allay privacy concerns when implementing beacons or other location-based technology, businesses should look for providers who are committed to user privacy, especially with regards to location data. For instance, the PlotProjects plugin comes with upgraded beacon monitoring, plus an array of industry-leading privacy tools and features.

BLE beacons in public transport

Bluetooth low energy (BLE) has been widely discussed but not much explored in the public transport field. However, with advances in BLE beacon technology together with its surge in demand, some are starting to see it as the perfect solution for mobile ticketing.

BLE beacons allow apps to detect users precisely, even in locations with limited internet access such as underground stations. Another advantage when compared to other types of mobile ticketing is that beacons allow for seamless detection, without the user having to use or even touch their smartphone.

One such mobile ticketing system is called ‘Be In-Be Out’ (BIBO) which is gaining attention and is being tested in several markets, but has not yet seen a large-scale roll out.

What is Be In-Be Out (BIBO)?

With ‘Be In-Be Out’ (BIBO), BLE beacons can determine exactly when a traveller enters and exits a station or a public transport vehicle. This is similar to the ‘check in-check out’ system, however with BIBO the user doesn’t have to perform any manual actions or interact with any ticketing points. Using beacons, the operator can easily calculate how long the user was using the service, then calculate the fare based on the best available rate at the end of the day.

Currently, there are no public transport agencies implementing this system, but it is being explored. Chiltern Railways tested it back in 2016 and Wolfgang Narzt et al proposed a ‘be-in/be-out’ ticketing system for public transport using BLE technology back in 2015. China is using NFC on public transport (without bluetooth). While its adoption in The Netherlands was researched by Delft University in 2017.

Beacon technology in mobile ticketing can be helpful for commuters and transit agencies

BLE beacons for mobile ticketing

Due to the rising popularity of BLE beacons along with the surge in the use of Bluetooth-enabled smart devices, low energy beacons could offer an effective and feasible solution for agencies looking for the next innovations in public transport.

This cost-effective technology has many advantages, including increased flexibility, precise tracking of user location, easy integration into transport networks, and a seamless, enjoyable experience for the user. Helpful route updates or navigation alerts are all made possible, along with additional support for riders with disabilities or impairments.

The technology also opens up exciting opportunities for transit agencies to partner with retailers to send exclusive location-based deals and offers. Or to put beacons to good fun with gamification, transforming a boring commute! The doors are definitely open for transit agencies to implement low energy beacon technologies, to not only communicate with and understand their users, but to improve both user and operator experience.

Interested in using beacon technology in your app?

Beacon technology is a powerful and cost-effective way to drive sales for businesses both big and small. If you need help getting started with beacons and geofencing, or you want to find out more about how our platform can drive results for your business, contact PlotProjects today.

You can try our demo app for free, or download one of our customer’s apps to see how it works. Don’t have an app? No problem. We can create a custom geofencing app using the PlotProjects technology.

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