Location tech shows a path to improved CEM

Tony Costa/Forrester Research
06 Sep 2013

Location technologies used to be thought of as the domain of maps and navigation, but no more. Today, location is a critical enabler embedded in a growing number of app categories ranging from social networking to shopping to app discovery.

Further, companies in retail, hospitality, transportation, healthcare, and other industries that have a strong emphasis on physical infrastructure are increasingly turning to location technologies as a means for improving their customer experiences. These companies are using location to:

  • Personalize service. eBay Now is making product delivery more personal by delivering products to customer wherever they are -- not a street address, but literally where they are. So the next time you're camped out at Starbucks or the park and need something in about an hour, eBay Now will bring it to you. In this case, eBay Now personalizes the experience by making the customer the destination, not an address.
  • Augment experiences. Boston Children's Hospital's MyWay app provides users with turn-by-turn directions within their massive hospital complex, minimizing confusion and improving navigation from clinic to clinic and then back to your car. They'll even help parents find family-friendly restaurants, lodging and services nearby.
  • Deliver action-based rewards. Shopkick, the fourth-most-popular mobile shopping app, with more than 6.5 million users, is working with retailers such as Crate & Barrel, Macy’s, Target, and Toys R Us to deliver rewards using indoor positioning. To receive rewards, users simply enter any one of the 7,000 participating stores. In addition, additional rewards can be earned by browsing “lookbooks,” scanning products in-store with their smartphones, and making purchases.
  • Target offers. Coca-cola partnered with Digby to deliver offers to fans of their Freestyle vending machines (which are able to make custom blended drinks from over 100 different Coke favors). Customers who opt-in to the program received discounts and access to exclusive blends such as orange creamsicle -- a yummy mixture of Vanilla Coke and Fanta Orange -- when they are near venues that have the machines during mealtimes.

The potential of location technologies doesn't end there, however. Companies are also using location technologies to bring the power of web analytics to the real world. This is enabling them to gain a deep understanding of customer behaviors in the physical world. Armed with this knowledge, they are now able to test out hypotheses, measure the imapct of in-venue changes, attribute visits to promotional events and campaigns, and increase operational efficiency.

For example, a high-end department store thought 80% of customers eating in their on-site restaurant were also shopping in the store. But after using location technologies to track and analyze where their customers were going, they learned the actual number was closer to 30%.

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