Opinion piece: How Micro-Location, Geofencing and Indoor Location Are Driving The Retail Revolution

GIS Contributor


Indoor Location has become the holy grail of location based-marketing, bringing consumers from their home to the closest shopping mall or retailer, greeting them with a message as they enter the mall or the store, helping them navigate indoors, send product information and special promotions as they get closer, and finally allow them to pay for the items right from their mobile.  Opinion piece by Christian Carle, CEO and Co-founder of Pole Star.

With the hype surrounding the launch of iBeacon in the Apple retail stores, proximity sensors, also called proximity detection devices or micro-location, increasingly feels like a revolution.

Since Apple launched iBeacon with the release of iOS 7 earlier this year, and Google finally upgrading Android to include Bluetooth Low Energy (BLE), the entire retail world is now excited by the opportunity of deploying BLE beacons to develop new retail services and create additional revenue sources.

As a consequence, the market is now flooded by tons of startups with BLE beacon prototypes, compatible or not with Apple’s iBeacon specifications – nobody knows, actually – with each making the promise that deploying beacons will solve the main problem brick and mortars are facing (in their competition with e-commerce sites), creating a direct link with the end user who will tend to spend more money when they are in the retail store and not when they come back to the competitors web sites!

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Capitalizing on the huge interest generated by these announcements, we now see many self-declared “domain experts” releasing reports identifying the growing number of startups announcing these next-generation beacons, that look much better – on paper – than those of established Indoor location experts but are limited in features and untested in the field.

A situation that makes it very hard for venue owners, retailers, shopping mall operators, etc., to get an overall picture of this mega trend, and decipher what is true from what is not.

Is Indoor Location Evolution or Revolution?

Indoor location is definitively a key feature with immense value. Massive adoption is on the way and the market finally reached maturity, which is typical of mainstream adoption: established business models, clear competitive landscape, and consolidations …

Customers are not early adopters anymore and decisions are now driven by added value considerations. Improved end user experience (which is a critical issue for most venue owners in particular in their battle against e-tailers) and identified tangible ROIs are key drivers for the Indoor location market.

The maturity of the indoor location market is already impressive, simply by looking at requests coming every day from retail stores, shopping mall owners, department store manager, large airports, train stations, convention and exhibition centers, smart buildings…


In other words, the technology works. Which is why it’s crucial for technology providers to set the right expectations, especially with the recent rise of point solutions that are very limited, both in functionalities and evolution. The key added value of an indoor location service is not in the Beacon itself but in the software intelligence that only Indoor location experts can bring to third parties, with easy to use deployment tools and an end-to-end platform.

For example, to make sure a user is inside an area or a shop in order to credit her with loyalty points, simple micro-location is simply not good enough. It lacks the additional intelligence to aggregate all the location data available (GPS, 3/4G, WiFi…) and provide the right location information in real-time. The main risk with unreliable systems is to alert users in a wrong area, flood them with irrelevant offers or discounts and at the end drive the interaction with the user completely inefficient.

Next up: Success of Indoor Location

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