Why Today’s Apple Announcement is a Big Deal for Marketers
By: Andy Maskin, Program and Platforms Director for FCB Garfinkel in New York.
In the hours, days and weeks to follow today’s Apple launch event, you’ll likely hear a lot of chatter about screen size, gigantic internal storage, toughened display glass and other features. And, much will be said about the new Apple Watch as Apple takes its stand in the intersection between gadgets and fashion.
But lurking within the new iPhones are two technologies that will increasingly become important tools for marketers. The esoteric acronyms for these two technologies are “NFC” and “BLE.” Here’s why, in layman’s terms, marketers should pay close attention to them in the coming years.
NFC stands for Near Field Communication and is already part of many of our lives without many of us realizing it. If you tap a plastic card to an electronic reader to enter your office or local transit system, you already use it.
Just like your office key card, when NFC is enabled in a mobile device, it means that you can tap that device to an object and it reads information from it. The thing being tapped could be as simple as an inexpensive sticker. As an example, Lexus published an ad in Wired magazine that included a simple NFC sticker. When readers tapped their phone to the ad, it automatically took them to a video on a website. This was back in 2012, as NFC is by no means new. What has happened in the intervening two years is that more and more devices have adopted NFC capabilities, to the point that all but the least expensive devices have it – except iPhone. Apple’s reluctance has held NFC back; if you were to launch a campaign or product dependent on your customer’s phone having NFC, a very large proportion of your audience would be cut off from the experience.
Meanwhile, there has been an ongoing debate around best practices for NFC within payments and non-payments contexts. While some dream of tapping ads or product packaging for more information, others are much more focused on people tapping their phones to pay for things.
Two of the biggest early entrants in this area have been Google Wallet and the recently re-branded [for unfortunate and obvious reasons] Softcard (née “Isis”). Apple, meanwhile, introduced Passbook, a mobile wallet of sorts that relied (thus far) on redemption via on-screen bar codes. With half the mobile world embracing NFC for payments and half seemingly rejecting it, merchants were loath to adopt or promote it. Why bother with the customer confusion, especially given the fact that upgrading POS (Point of Sale) systems is fabulously expensive?
With today’s announcement, Apple has changed the game. As iPhone 6+ models flood the marketplace in the coming years, marketers and merchants looking to take advantage of NFC can do so knowing most of their audience will be able to take part. With the launch of Apple Pay, the Android (and yes, Windows Phone) platforms will need to up their games as well. This competition should give a strong near-term bump to consumer awareness, and soon enough merchants will follow. Already, as of today’s announcement, over a dozen major chains such as McDonald's and Macy’s have agreed to accept Apple Pay.
Here’s why it matters so much to marketers: point-of-purchase is where the rubber meets the road for most consumer categories, particularly CPG. Influencing consumers on mobile will become even more critically important as their device becomes not just a way to check Facebook while waiting to pay, but is the way to pay. Marketing offers that exist purely in digital form, seamlessly from exposure to redemption, will eventually become the norm (at the eventual expense of FSIs).
Think about an out-of-home/print advertising user experience that goes like this:
Step 1: Consumer sees ad with offer or product with NFC call-to-action
Step 2: Consumer taps smartphone to designate spot, offer is loaded into their virtual wallet.
Step 3: Consumer purchases product, taps phone to pay at the register, discount is automatically applied.
Until today this type of user flow was a futuristic edge-case. Many conferences have been held, and much future-gazing has been undertaken. I posted about some of this last year here. With Apple’s adoption of NFC and focus on payments, this future just got a lot closer.
BLE stands for Bluetooth Low-Energy, and it is a protocol built into most modern mobile devices. While “regular” Bluetooth can transmit audio or even video, BLE can send only limited strings of text. That limitation comes with an upside, however, in that it consumes much less power.
One of the most interesting applications of this technology is the use of so-called “beacons.” These devices can be programmed to broadcast an alphanumeric code every few seconds. They can be produced very inexpensively and can run for years on a single battery. A smartphone app enabled with the technology to “listen” for these beacons can detect not only their presence, but also how far away they are and in which direction. This is how FCB’s award-winning NIVEA beach bracelet works.
In a retail or out-of-home setting, beacons can help consumers find where they physically are with greater precision than GPS. With this level of “micro-location,” users can be targeted on mobile with ads not only specific to the store they are in, but also the section of the store. Close proximity sensing can be used to enable push notifications of relevant information in any number of settings that might be relevant for a brand.
For years, as with NFC, BLE was the province of edge-case Android applications. Although the technology was quite advanced, working with it meant that your customers who had iPhones were out of luck. Recently, however, under the radar at a June 2013 developer conference, Apple announced support for BLE under the “iBeacon” name. It then ran a trial of beacons in its U.S. retail stores.
In subsequent months, the number of tech companies, merchants and advertisers who’ve shown interest in BLE beacons has grown steadily. In fact, the standard is supported by the current generation iPhone 5 models.
When Apple first hinted at support for BLE for an audience of developers, speculation became rampant that NFC was “dead” and Apple would never embrace it. In reaction to that chatter, I wrote an in-depth exploration of why I felt this was not the case, which you can read here. In short, beacon technology and NFC technology are for different uses. They’re different tools for different scenarios. Which one you use (or both) depends on what you’re trying to accomplish.
Besides the new iPhones, the big headline-grabber will likely be the Apple Watch and how you can access all sorts of great smartphone-like features from a beautiful device on your wrist. Multiple Android manufacturers have already released smartwatches, with spotty success.
What makes Apple’s entry into the market special is not that they have an inherently superior product that eclipses the Galaxy Gear or Moto 360 by leaps and bounds but it is that Apple is now on board, making it poised to go mainstream. And once it is mainstream, the question is: “Should marketers be paying attention or is this just another toy?”
The answer to this is a measured “yes, it should be on our radar.” Given the small-screen real estate, users will likely not load up on branded content or apps on their smartwatches. It is also unlikely they will tolerate banner ads on their wrists.
Where there is opportunity, however, is in the realm of push notifications. If a user has downloaded a brand or merchant’s app on their iPhones and hasenabled notifications from that app to go to their smartwatch, then there could be opportunities to surface interesting short-form text content. That said, it would have to be very contextually relevant. General brand messaging won’t fly. But let’s say you walk by your favorite store and they push you a notification of a flash sale. That could be an example of providing consumers with timely utility rather than just a message blast.
In addition, Apple Watch will support Apple Pay, giving another boost to the newly announced payments platform.
Not to take anything away from the big beautiful screens and enormous internal memory, but for those engaged in the business of reaching the right consumer with the right message at the right time, the big news today from Apple isn’t screen size, memory or beautiful design. Although smartwatches, NFC and BLE have been available in various forms for years, Apple’s embrace has challenged us all to step up and use these new digital tools as part of our overall technology mix.