Thursday, January 22, 2015

Lord & Taylor / Hudson's Bay iBeacon Pilot Shows Promise

Former Hudson's Bay/Lord & Taylor CSO: iBeacon Engagement "Phenomenal" But Does it Have a Future in Payments?

By Marc Dresner, Senior Editor, IIR

The shopper’s path to purchase took an exciting turn in mid-2013 with Apple’s introduction of the iBeacon (followed in short order by a bevy of beacon competitors, of course).

And then things got quiet as everyone went off to play with the shiny new toy…

The attraction is a no-brainer. The ability to beam marketing messages, coupons, etc., to the shopper’s phone in the store while they’re actively shopping and to then check them out at POS is something with the potential to revolutionize retail.

According to Business Insider, about half of the top 100 U.S. retailers have been testing beacons and it estimates the technology will be installed in roughly one-third of stores by the end of 2015.

Indeed, everyone from Walmart to McDonald’s to Major League Baseball has been trialing the Bluetooth transmittors.

Ryan Craver
And the results from those tests are now, finally, slowly trickling into news reports.

So I was pretty excited to learn that Ryan Craver, former SVP of Strategy for Lord & Taylor/Hudson’s Bay Co. and who had spearheaded a beacon test for the department store chains, was available to discuss the results.

Craver and his colleagues tested beacons in three different store environments in the U.S. and Canada ahead of a 140-store rollout. (Author's note: The initiative won Mobile Marketer's 2014 Program of the Year. It's toward the end of the linked article.)

And the results were mixed, but very promising.

“The open rates were phenomenal!”

“Our first hypothesis was that the engagement numbers would be off the chart. That held true. The open rates were phenomenal,” Craver told On Payments.

The beacons did not, however, drive traffic in the numbers Craver expected.

Craver says that’s because the app simply isn’t ubiquitous…yet.

“Once beacons are integrated into apps like Facebook and Twitter, we are going to see much, much bigger numbers.”

“Beacon ecosystems haven’t built up yet. But once they are integrated into some of the apps like Facebook and Twitter, we are going to start to see much, much bigger numbers,” Craver predicted.

But whether beacons have a future as a payments tool is questionable. Craver notes the growing popularity of NFC platforms makes it less likely.

“By the end of 2015 or early 2016, all retailers will need to have chip-and-PIN POS.”

“By the end of 2015 or early 2016, all retailers will need to have chip-and-PIN point-of-sale equipment and that will naturally lead to additional retailers that have NFC capabilities,” Craver said.

“So, maybe NFC beats out beacons?” he added.

In this podcast for On Payments—the All Payments Expo (APEX) interview series—Ryan Craver discusses Lord & Taylor’s beacon study, opportunities and challenges for retailers and whether or not the beacon will be the it app for shoppers.

Editor’s note: Ryan Craver will be a featured speaker at APEX 2015—the All Payments Expo—taking place February 23-25 in Las Vegas.

For a brochure or to register for APEX, please visit

Ps. LAST CHANCE! REGISTER and SAVE $200 by FRIDAY 1/23 with promo code XU2848BLOG

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