You’re walking down the shoe aisle of your favorite department store. You’re browsing. You’re probably thinking to yourself, "Do I really need another pair of shoes?" Your phone buzzes. You take it out of your pocket to find a push notification from a shoe brand with a discount offer. It’s a brand you like. You were on the fence. You buy the shoes.
That, or a variation thereof, is the ideal scenario envisioned by Swirl, a beacon tech provider that announced the launch Monday of what it’s calling the first programmatic ad exchange for proximity-based in-store mobile marketing.
The Swirl Ad Exchange, SWx for short, is in the process of integrating with around five DSPs and agency trading desks, although Swirl declined to name which ones. Swirl has relationships with several mobile app publishers, including Condé Nast, coupon and shopping app SnipSnap and Hearst, also a Swirl investor.
Brand clients include Lord & Taylor, Hudson’s Bay, Marriott, Alex and Ani, Timberland and Kenneth Cole. The company also recently formed a partnership with Motorola Solutions to power the latter’s indoor locationing platform MPact.
The Swirl technology works by communicating with shoppers through apps and strategically placed indoor beacons. Consumers who opt in to receive notifications – either via the Swirl app, a retailer’s own app or one of a number of third-party apps – are messaged in-store based on their location and previously stated preferences.
“Third-party apps allow retailers and brands to reach larger audiences of in-store shoppers,” said Swirl’s VP of marketing, Rob Murphy, who noted that the company is aiming to reach an audience of about 100 million smartphone users by the first quarter of 2015.
Rather than an open exchange, SWx will enable retailers to create private ad exchanges through which white-labeled brands will be given permission to engage with shoppers through a particular beacon network.
That would ostensibly give shoe brands battling for supremacy in the shoe aisle, for example, a chance to one-up the competition with an on-the-spot targeted communication. It would also give retailers and publishers the opportunity to put their existing beacon network to better use by packaging and selling in-aisle ad inventory.
Although Swirl beacons don’t yet support NFC – right now only Wi-Fi and Bluetooth are on the menu – near-field enablement is on the company’s immediate road map. Makes sense, considering Apple Pay officially launched Monday.
“Apple Pay provides significant benefit for Swirl and the beacon marketing industry in general,” Murphy told AdExchanger. “[It] provides a seamless way for retailers and brands to measure the effectiveness of their in-store mobile marketing efforts by closing the loop between beacon-triggered messages/offers and actual consumer purchases in the store.”
Beacons clearly have the potential to bridge the physical and the digital, and according to ABI Research, indoor beacon installations could top 30,000 worldwide by the end of 2014. But there are still the naysayers out there who don’t think marketers are ready to include beacons in their strategy in any kind of really meaningful way.
Naturally, Murphy disagrees.
“Beacons provide the missing link that will allow marketers to connect digital experiences to real-world behaviors,” he said. “Of course, we are still in the early stages of taking advantage of the full capabilities that beacons and indoor mobile marketing offer, but as retailers, brands and marketers continue to gain learning regarding how to best utilize this powerful new capability, we will begin to see its full impact.”