Feb 25, 2015To boost their engagement with shoppers, two Midwestern grocery retailers are installing a Bluetooth beacon solution provided by retail technology startup Birdzi. Niemann Foods is expanding its deployment at eight of its County Market stores to all 45 locations throughout three Midwestern states. Woodman's Markets is launching the system at one of its stores this week, and plans to expand it to 14 more.
As a shopper walks around the store, the system pushes promotional offers and other information to an app running on that individual's smartphone, based on her location and preferences—such as a sale of a baked-goods item she tends to buy in the bakery, or a promotion that might lure her to try a product she has not purchased before, based on her other interests.
The app also offers such features as a collaborative option allowing family members to share a shopping list if they are at the store at the same time. As they place items in their carts, they can manually remove those products from the list so that they do not make duplicate efforts.
"It's all about engagement," says Shekar Raman, Birdzi's CEO and co-founder. If a store only provides coupons and offers, he says, it cannot engage a shopper in the same way that it could if it were able to communicate with that person by providing other relevant content.
When Raman discusses the innovation behind his company's Bluetooth beacon and Wi-Fi solution for shopper engagement, he must defer to his teenage daughter. It was she, he notes, who, at age 10, first brainstormed the idea of a technology solution that could help shoppers find what they needed in the store.
"My daughter came up with the idea for an invention-day project, and put together a model of how the device would work," Raman explains. "Shoppers would type the product they were looking for into a device specific to the application, in the store, and the device would provide the location of the product. The device would be available for shoppers to pick up at store entry and easily mount on their shopping cart."
Based on her idea, Raman and his former colleague, Francisco Borges (now Birdzi's CTO), formed Birdzi in 2010. Together, they began developing the company's Shopper Engagement Platform, which includes content management for a store's smartphone app to aid various aspects of a shoppers' experience, as well as a service that provides business analytics for retailers regarding traffic movement, customer interest in specific products and resulting purchases.
At the time, Raman had more than a decade of experience in the technical sector, working for several telecommunications firms as an infrastructure architect, providing design and implementation. "I came out of a hardcore IT background," he says. Borges and Raman began developing a platform for retailers, and drew in another colleague, Volker Hauf, to handle Birdzi's software architecture. Smartphones were already making apps ubiquitous, so they created an app that would allow shoppers to locate items on their phones, rather than requiring a screen at the store. They also considered the importance of knowing where users were located as they accessed app-based content, so that the system would be able to provide directions to a particular item, or supply data relevant to a specific location, such as an aisle or department.
Raman says they looked into a Wi-Fi-based solution—first a Microsoft Windows-based system that proved to be very expensive—then built their own Wi-Fi system that would identify where a shopper was located within a store, via the Wi-Fi signals sent by his or her phone. In 2012, Birdzi partnered with Gary Hawkins, who had extensive experience as a retailer himself—and who, for the past 25 years, had been carrying out development work related to loyalty and shopper marketing programs for stores. This, Raman says, brought retail expertise to their solution.
The Wi-Fi version was already being piloted and deployed at several stores when the company began developing a version of the Shopper Engagement Platform utilizing Bluetooth Low Energy (BLE) beacons. By using beacons, which a third party custom-makes for Birdzi, a retailer could push content to its app running on a customer's smartphone, based on that person's location within the store. Such information could be coupled with other details, such as the shopper's purchasing history, as well as the date and time of day, in order to ensure that content was relevant for that individual at that particular moment.
For the Niemann Foods or Woodman's deployments, consumers download the myCountryMarket app (available at the Google Play or iTunes website), or the Woodman's app (also available at Google Play or iTunes). Birdzi developed the apps for both retailers, and also provides content-management software and hosts the collected location data.
Shoppers are invited to set up an account and provide personal information, such as their name, e-mail address, demographics and "favorites" about which they would like to receive promotional data in the future, either when physically present at the store or on a weekly or daily basis. They can then use the app to set up a shopping list at home or input recipes. Upon a customer's arrival at the store, as long as the Bluetooth functionality of his or her phone is activated, a beacon at the entrance will transmit its unique identifier. That data is captured by the BLE functionality in the phone, which forwards that information to the app, where Birdzi's back-end software identifies the individual's location and other information, such as a shopping list, then forwards content to the phone. That content typically includes a welcome message, as along with details such as the aisle on which each item on the shopping list can be found.
Niemann and Woodman's have very similar versions of the solution, Raman says, though the Woodman's system will include a feature for the digital redemption of coupons at the point of sale. In that case, if a shopper receives a coupon for a specific product, he can simply present his phone to a sales clerk in order to have the discount applied immediately. Future versions of Niemann's deployments will also come with that feature—however, the existing deployments require that shoppers pay full price for an item and receive a voucher on their phone that they can use at the store when making future purchases.
Woodman's Foods has very large stores—up to 230,000 square feet—and Raman says Birdzi is installing approximately 50 beacons at each site.
Niemann Foods was among the technology's first adopters, and the system is now in place at eight of its County Market stores. But by the second quarter of 2015, the retailer intends to install the beacons for use with its app at all 45 stores, which are located in Iowa, Illinois and Missouri. Woodman's Foods is currently in the process of rolling out the solution at 15 of its stores, located in Wisconsin and Illinois, by this spring.
Some of Niemann's stores also have the platform's Wi-Fi functionality in use, as a way to capture traffic data about shoppers' movements. Raman notes that by using Wi-Fi for this function, stores can view the movement of every person equipped with a phone, rather than just those with the app downloaded and their Bluetooth connectivity enabled. This feature allows for greater visibility into traffic movement within the store.
Nathaniel Jones, Niemann Foods' electronic marketing manager, says the retailer has found benefits for customers using the app at its pilot stores. "They enjoy receiving the offers when they want it, where they want it," he says. "We're able to connect with our shoppers in a way we never have before. And they are able to connect with us... the "Feedback" portion of the app has been a great asset, because we are learning what the customers want, what they dislike, etc. It allows us to open up the lines of communication."
For Niemann Foods, Jones says, customer engagement is critical to Niemann Foods' future. "We want County Market customers to interact with us wherever they are: in the store, at home or on the go," he states. "It's more than just communicating at our shoppers—it's actually connecting with them. That's what we really value."
