Proximity Marketing is a $52 Billion Market
With the availability of global positioning systems (GPS) in every smartphone, marketers have been given a very exciting and effective tool for targeting consumers with their messages. Location-based marketing, as it is known, is becoming very popular among both marketers and consumers because it allows for relevant ads and messages. For example, if it’s 100 degrees outside, ads to local users can be for water ski jackets and not for snow ski jackets.
Location-based advertising has been proven to be 20 times more effective in providing returns than generic banner ads. However, satellite GPS is not very accurate when it comes to indoor applications, such as knowing which floor of a building or what aisle of a store in which a person is located. For this very last meter of indoor precision, locally installed smart devices or beacons based wireless networks such as Bluetooth, Near Field Communication (NFC) and Wi-Fi, are proving to be very effective, and as a result, the market is growing rapidly.
This more granular version of location-based marketing is known as “proximity marketing.” According to Research and Markets, the proximity marketing market is expected to be worth $52.56 billion by 2022, with a compound annual growth rate of 29.8% between 2016 and 2022. This spectacular growth is driven by the need for more personalized location-based services and the ability for businesses to engage with consumers on a very personal level where they are -- in, near or around specific locations.
One of the latest trends underlying this massive market opportunity is the low cost of Bluetooth Low Energy (BLE) beacon technology, which allows direct interaction with smartphones based on their proximity. This low cost technology allows businesses, big and small, to implement proximity marketing strategies. According to the 2017 Proximity Technologies in Retail report, businesses can expect to achieve more than 350% return on investment in beacons and custom smartphone apps.
It’s no wonder that the beacon and proximity sensor installations are growing rapidly.