LED-Based Indoor Positioning Services Benefit Shoppers and Retailers
By Kurt Vogel, Director, Retail Marketing, Acuity Brands Lighting
In spite of advances in retail technologies and savvy shopper marketing strategies, “couldn’t find it” and “couldn’t find help” are all-too-common shopping experiences that kill sales and erode shopper loyalty. New LED lighting-based indoor positioning and wayfinding solutions have emerged as powerful tools to engage and assist in-store customers, at the precise points of purchase decision, in the aisle and on the shelf.
In-store positioning is similar to the Global Positioning System (GPS) technology that many of us depend on while driving. New technologies tailored to indoor environments have evolved that use fixed-location transmitters or beacons, a mobile device, digital indoor maps, and a loyalty app to provide location and navigation within the store. Beacons are being tested by more than half of the top 100 U.S. retailers, and Opus Research predicts that by 2018 roughly $10 billion in consumer spending will be influenced by indoor location positioning.
Indoor Positioning: Technology Matters
Among the beacon technologies being trialed, one platform has emerged as the clear winner in terms of accuracy, coverage and, most important, low cost of deployment and maintenance: LED lighting-based beacons using visible light communication (VLC) technology.
VLC offers value and precision unmatched by other beacon technologies. It takes advantage of the ultra-rapid oscillation of light emission from LEDs to deliver binary code to a receiver (imagine a very fast flash light sending Morse code) so fast that the data signal is not visible to the human eye—but the light source is.
VLC has one drawback: it works only as long as the customer has his or her mobile device out and in active use; the accuracy diminishes if the device is out of sight in a pocket or purse. However, when the device is out and in use, VLC delivers pinpoint accuracy; other beacons, in contract, are not as reliable and can only locate to within several feet—not much of an aide if looking for a small item in a vast, densely packed grocery store aisle. Further, VLC works quickly to initially locate a shopper (or product). Its low latency allows for a person or item to be positioned within 1/10 of a second, and that position is updated as often as five times per second.
A particularly valuable attribute of the VLC technology is its ability to accurately determine a shopper’s orientation in the aisle, displaying the direction in which the user is facing. This can be critical to not only aiding the shopper in locating merchandise quickly but also in saving time during the restocking and shelf-set process. VLC can provide granular and actionable information for delivering relevant point-of-purchase messages (e.g., send the coupon for a cola when the customer is facing soft drinks, and not when they’re looking at snack items).
The best-performing LED-based indoor positioning solutions marry two complementary technologies: VLC and Bluetooth® low energy (BLE). BLE complements VLC, providing accurate location for out-of-sight devices. This innovative approach using LED lighting systems provides significant advantages:
- Painless for the retailer to incorporate; uses existing lighting infrastructure rather than requiring additional equipment such as stand-alone beacons, bringing faster return on investment (ROI) to LED deployments
- Powered at each fixture, which reduces maintenance costs by making them battery-free, since the BLE radio is powered by the light fixture
- Placed everywhere humans are; reaches every connected shopper that has a mobile device equipped with a camera or BLE technology
- Precise in determining location and direction of opt-in shoppers anywhere there is light, with accuracy within inches
Business Benefits for Retailers
Retailers have the opportunity to enrich the customer shopping experience using these indoor positioning services. Here are the key benefits:
- Efficient, convenient, and personalized shopping: Shoppers can quickly gather items from a shopping list and use the app’s “blue-dot” mapping feature to get step-by-step guidance to the exact location they seek. They also benefit from better deals because the retailer can send coupons and discounts tailored to their specific needs in real time.
- More choice through omni-channel shopping: Working with the retailer’s mobile loyalty app, indoor positioning optimizes online, mobile, and in-store channels, providing shoppers with information and tools to find, buy, and receive the items they want. If the shopper wants more options, the app can connect the shopper to the retailer’s online store to browse additional items and get online-ordered merchandise delivered directly.
- Hassle-free new store experience: Indoor positioning guides shoppers through an unfamiliar environment so they can enjoy a new shopping experience with the same ease as in their “home store.”
Beyond the customer experience, indoor positioning is making its mark in other ways that bolster business for retailers:
- Smarter Merchandising: Advanced data analytics, using location data paired with point-of-sale and inventory data, can better track the effectiveness of store design. Retailers can detect in-store traffic patterns and dwell times, coupon conversions, and other information to assess the impact of marketing and merchandising strategies.
- Optimized Operations: Employee deployment is optimized by providing digital work orders that send a worker directly to a customer needing assistance or to a location requiring urgent attention, such as a spill.
Indoor positioning services provide a strategic platform for the connected retail store of the future, with significant benefits for both shoppers and retailers. Taking a comprehensive, hybrid approach to indoor positioning that leverages LED lighting and the two best performing indoor location-based services, VLC and BLE, enables retailers to quickly find, engage, and satisfy shoppers with the highest accuracy across the largest store area. Higher sales, greater customer satisfaction, improved operational efficiency, and stronger ROI on lighting assets make LED-based indoor positioning a winning proposition all around.
This piece was originally published in the February 2016 issue of ei, the magazine of the electroindustry.
 “Beacons Beckon,” by Diana Bradley, PRWeek, February 2015, page 34
 “Mapping the Indoor Marketing Opportunity,” Opus Research, February 2014