Proximity Marketing – Probabale Future of Digital Retail Market

Marketing mix has influenced the world of marketing significantly. The concept of 4P’s- product, price, promotion, place by E Jerome McCarthy which was later changed to packaging, positioning, people and performance initiated remarkable growth and success to number of brands in the market.

The new era brought with it the concept of proximity. The concept uses the geographical location of the customer and target consumers in that physical location after examining the needs of the customers. It is achieving superiority and is becoming the main driving force in planning marketing strategies for different brands. In this blog post we shall discuss how proximity marketing has influenced the digital world.

What is Proximity Marketing?

Proximity marketing can be defined as geo-location based technologies, like – Wi-Fi, Beacon, Geo-fencing, Near Field Communication (NFC), and GPS to engage customers precisely through their digital gadgets.

This digital and cellular technology diagnose mobile-device users who are near in proximity to targeted business location. These enterprises target device users with existing promotional advertising messages.

Proximity: The Quintessential Millennial Technology

Proximity has become one of the most popular consumer technology because of the use of smartphones. With the number of smartphone users skyrocketing, Proximity marketing will deliver the most compelling and strongest strategy for business enterprises so that they can reach to their digitally targeted customers.

According to the reports by Market and Market, proximity is expected to be worth 52.46 Billion by the year 2022. A different report by Proxy Book says that more than 19 industries have invested in development of proximity technologies.

The top five are shopping, retail, malls, tourism, and hotels. Among them, retail has been more aggressive in investing and developing in the latest location-centric marketing strategy.

As per the predictions by BI Intelligence, out of 4.5 million beacons that has to be active by 2018, 3.6 million is shifted to operate in retail industry. Because of this prediction, sellers and retailers are aiming to fight back the offense of online shopping and connecting with the millennial generation and magnetizing them back to stores with the help of personalized offers and leveraging technology.

Why Proximity is Emerging as the Strongest Marketing Mix?

There are four main reasons that makes proximity as the strongest marketing mix techniques:

  • Amalgamation of Mobile Culture and Digital Signage
  • Deliver Personalized Experience
  • Intelligent Analytics
  • Cost Effective

What is a Beacon?

ibeacon, also known as beacon is a tiny device, equal to the size of a pebble, that is found stuck on the walls of stores. These devices emit a Bluetooth low-energy (BLE) wireless signal to connect with the customers’ portable or digital devices.

Beacon helps in tracking customer’s location within the range of nearby store. The BLE signal emitted is received by a particular app compatible with the device and is within the range of the BLE signal. When the app detects the signal, the customer receives a message that highlights information about a personalized coupon and offer that they can avail in the store.

Why Beacons Are the Next Big Thing?

Market industry often dwells with a cold war between e-commerce players and those brick-and-cement store fronts. Physical store aim at beating back the e-commerce competitors, who offer comparatively low prices for the product because of low overhead cost. Surely, e-commerce is outraging the retail pie.

According to an independent survey, in 2014, e-commerce estimate increased by 14.6% from the fourth quarter of 2013, while the total retail sales increment was 3.7% in the same time period.

In the fourth quarter of 2014, e-commerce sales accounted for 6.7% of total sales. In this case beacon is a saviour for retailers.

As per the reports of business insider beacons has directly influenced more than $4 billion worth of U.S. retail sales in 2014 at top retailers, or 1% of the total. That number increased ten times by 2016. In particular, beacons that enable shopkeepers to provide deals, special offers, and discounts to customers when they are in proximity to the store- this will be the upcoming evolutionary phase for retailers and an integral part of marketing.

Beacons send messages to customers in place of gathering data. When shoppers enter the location within the BLE of beacon, they receive message containing exiting offers. These offers persuade the customer to buy the product.

Beacons can beat back a large competition against e-commerce merchants the reason being, despite growing popularity of online shopping, more than 90% of the products that are bought by the customers come from these stores.

Beacon program, with its broadcast characteristic, can successfully attract passersby to come in. That is one of the biggest and a clear and distinct advantage for retailers over e-commerce players.

Beacons broadcasts a “consider stopping in” message, that is received by a shopper on their smartphones.

This method can attract new customers, who may not consider coming to the store before receiving the message. A directed effort is obtained by hyper-local marketing, that provides specific messages to specific customers.

Win-Win Situation

Retailers get benefit because they understand the demands and needs of the customers. By offering on-the-spot coupons and discounts, the technology attract shoppers to make purchase at the store.

Beacon technology enable merchants to improve the structure of their store setups. Product makers are also involved by bidding for interior store locations and advertising their products with beacons.

Beacon is beneficial to customers as the smartphones not only has connection with the help of internet, but they can get messages with the help of Bluetooth connectivity. This proximity marketing technology will have a great impact on the structure of market.


In this blog post we shall understand the impact of proximity marketing, one of the strongest element of marketing mix, on retailers and on growth of marketing industry.

We shall also learn about beacon that has influenced the sales in retail sector and has given a kick to retailers in competing against e-commerce players. ibeacon, also known as beacon is a tiny device, equal to the size of a pebble, that is found stuck on the walls of stores.

These devices emit a Bluetooth low-energy (BLE) wireless signal to connect with the customers’ portable or digital devices. Beacon helps in tracking customer’s location within the range of nearby store.

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