The choice of location-based technologies is so wide and varied today that it has become difficult to weigh their pros and cons. Consulting with this concise overview can help you settle with the right decision for your business.
The number of local data transfer technologies for mobile devices is continuously growing. Research and Markets consulting group has reported the location-based services industry to account for $11.6 billion in 2015 and predicted it to grow fivefold by 2020. Banks, public facilities, and retailers now all strive to communicate with their customers in a more personal, flexible and mobile way.
Global Positioning System (GPS), Wi-Fi, Li-Fi, Near Field Communication (NFC), and Beacon technologies help businesses target a specific audience, boost consumption, as well as increase customer loyalty. But the question is, how exactly do these solutions differ from each other? More alternatives mean you’d need more facts on each technology’s limitations before choosing the one, so here’s the overview that puts up all of the technologies against each other.
Accuracy: High outdoors, low indoors
Equipment and costs: None (the system is already there)
Best for: Outdoor promotions. If set up indoors, for example, in a shopping mall, GPS satellites won’t be able to differentiate one floor from another and can end up targeting a completely uninterested audience.
A use case: Banks can simply transmit special offers via their ATM machines, but chain stores can create entire promotional quests for their customers. For instance, after making a purchase at one of the chain cafes, a customer will receive an invitation to their mobile phone to visit a newly opened chain (or partner) restaurant to win a bonus. As the customer will be approaching those stores, a GPS-enabled mobile app will detect them and reward with a discount coupon.
Range: About 230ft
Equipment and costs: Beacons/transmitters (about $25 each)
Best for: Indoor promotions. Beacons can be placed right in front of any specific shelf or department in a store, where they will accurately detect the presence of the target audience.
A use case: Powered by Bluetooth Low Energy, beacons cause very low battery drains compared to Wi-Fi or GPS. However, customers have to switch Bluetooth on their devices, and there should be stickers around the store that would ask them to do so if they want to get special offers.
A beacon can respond not only to a customer's presence, but also to the amount of time they spend at a certain location, interpreting it as their level of interest. For instance, if a customer stands in front of the comedy bookshelf for about a minute, they can get a pre-order discount for a coming-soon book of the genre on their mobile phone.
Range: About 100ft
Accuracy: High (without metal and glass barriers)
Equipment and costs: A Wi-Fi router ($50-200)
Best works for: Indoor data streaming and collection. Surveys say, almost70% of people think that getting Wi-Fi access is worth giving out their email address or other personal information that can later be used for promotions.
A use case: Apart from being more expensive than beacons, Wi-Fi is way less accurate, so installing it at venues for the sake of implementing highly individual promotions is impractical. Instead, Wi-Fi connection can be used to notify any customer who enters a certain venue about the possibility to browse an extended showcase online and have a look at the products available for purchasing but currently out of stock in that particular store.
Range: About 10 feet (under the light of one LED bulb)
Equipment and costs: An LED system ($100) + a router ($150) + receivers ($25)
Best for: Providing more information at a customer’s request. Although Li-Fi offers an enormously high speed, it has a small range and low accessibility. A mobile device should be right in the LED spotlight to be communicated to, so push notifications won’t work if a customer has their device in the pocket.
A use case: As gallery visitors stop under the light bulb in front of the painting for a while, see the Li-Fi sticker on the wall and take out their phone, they will be able to instantly get additional information on that very piece of art in their mobile app. In case of exhibitions and large stores, Li-Fi can provide videos or even 3D models of items on display.
Range: About 4 inches
Equipment and costs: NFC tags ($0.10 per tag)
Best for: Identity verification. NFC has an extremely narrow range but also an extremely complex data encryption, which makes it the most secure wireless method of performing data transfer.
A use case: To prove their identity to a hotel restaurant or a room service worker, a guest can simply use their mobile device. As they touch an NFC reader with their mobile device, personal data will be safely transferred to the hotel employee’s desktop computer, tablet or smartphone. If there are some ongoing special offers from other businesses, a guest’s app can receive a discount coupon for a purchase in a local partner shop or a museum in return for checking-in with NFC.
While in most cases it’s easy to find the most suitable solution, at times, determining which location-based technologies would suit a particular business can be tough and even require professional IT consulting. Mind that costs of mobile app development will also dependent on a mobile platform choice and the service of choice and its functionality: a Li-Fi 3D model showcase will be less cost-effective than a newsletter app activated by beacons.