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Facebook?s NYC beacon play could start marketing free-for-all

Beacons? growing acceptance could turn up the competition among the industry?s dominant players and redraw the mobile marketing landscape, fueled by Facebook?s recently announced plan to begin testing a beacon-supported service to deliver information about shops to nearby users in New York.

A successful Facebook beacon experiment could ratchet up the battle among Apple, Google, Yelp, Facebook and other installation players for market share. The potential for Facebook?s data-rich site to increase marketers? power to drive traffic and instant sales ensures it could be a catalyst in a free-for-all featuring the industry?s giants.

?This could be the tipping point for mobile marketing and it seems like the key players of today are standing on the precipice of dominating that market,? said Josh Martin, director of analytics research services for Strategy Analytics, Newton, MA. 

?[The Facebook project] is really an indication that, by and large, mobile marketing of today is not working.  

?Either opt-ins for location are difficulty to gather, or battery drain requires minimum GPS usage,? he said.  ?If beacons are the future, then it sets up some very interesting dynamics. It could create entirely new ad networks and players.?

Place Tips
Facebook?s Place Tips service will deliver information about eight Manhattan shops to nearby users. The service, which is free for businesses, will provide information taken from the locations? Facebook pages, above the news feeds on users? smartphones. 

Account holders can turn Place Tips off or on at any time in their settings or just hide tips about specific places. Place Tips only appear if the mobile user gives Facebook permission to access his or her location.

Demonstrating Facebook's Place Tips feature.

?Much of this is really about creating demand and introducing a new paradigm,? Mr. Martin said. ?If Facebook delivers value, then I think consumers will be interested in using it more. 

?This also sets up a battle with Google, Yelp and eventually Apple as who gets to install hardware in different locations,? he said. ?Will companies demand exclusivity for free hardware? 

?It could fundamentally change how people use these services on mobile, making them more relevant and better marketing vehicles.?

Facebook?s new service thrusts into the spotlight the search for the holy grail of marketing: the ability to deliver relevant information to the mobile device.

Many marketers have tried and failed at the challenge, thwarted by the difficulty of reaching a person just as he or she arrives at a place. 

By using beacons, Facebook will attempt to produce a marketer?s dream scenario - capturing a consumer?s location and then influencing an activity.

Although Facebook?s Big Apple beacon project potentially raises privacy concerns, the program is seen as unlikely to cause controversy.

?Some consumers may object to their content being aggregated in this fashion in a separate feature, but it?s not like Facebook is presenting anything new that hasn?t already been made available,? said Nitesh Patel, director of wireless media strategies in Strategy Analytics? global wireless practice.

?Figuring out which places to visit and looking for recommendations on what to do, where to eat, is always going to be top of mind when consumers are out and about.? 

?As a marketer I would be concerned about whether the pictures or videos or comments being aggregated from users feeds are appropriate and fit with my brand and whether the location information is accurate enough,? Mr. Patel said.

Place Tips can be turned off at any time, softening privacy concerns.

Privacy would be an issue only if the service demands total access and then begins to act out of line. 

?An example could be the service knows you?re downtown and then polls your address book and automatically posts on the walls of people who live in the area that you are there and they should come hang out,? Mr. Martin said. 

?Or if Facebook can poll other apps and knows you hate a certain food and recently started a account and therefore gives you a recommendation for a place to find a date and some good eats. 

?Clearly these are just made-up examples, but are trying to illustrate how things could go awry and become problematic.?
Facebook?s beacon endeavor indicates the public may be shedding some of its inhibitions about disclosing personal information in the mobile space.

?Consumers are willing to share all forms of explicit personal data around preferences, interests and location as long as there is balanced value exchange ? what is received in exchange for revealing location must be of high value and relevant to that consumer,? said Matthew Ramerman, managing director and co-founder of Vehicle.

?If relevancy is simply 'location' or 'proximity' to a beacon location, I don't see a future for the program,? he said. ?However, if Facebook only triggers an offer or message about the book store based on the user?s explicit or implicit indication of interest in literature, then the program has a future.  

?The second question is user-experience,? he said. ?If the Place Tip prompt requires a user to have their Facebook app open and running, while moving around the city, I predict fairly low engagement.?

Facebook?s bigger challenge is overcoming the hurdles associated with beacons in general, with the need for pairing the program with an activated Bluetooth function topping the list.

Draining battery
?Consumers often use Bluetooth to connect to car sound systems, speaker systems,? said Shuli Lowy, marketing director for mobile with Ping Mobile. ?However, most don't keep it on throughout the day because an unconnected Bluetooth signal drains battery quickly. 

Introducing Place Tips on Facebook.

?If your Bluetooth signal is on but not connected to a Bluetooth device then your phone will continuously search for it,? she said. ?It's as if your phone is knocking on a door and waiting for it to open. It's exhausting.?

Beacon campaigns also require a Bluetooth receptive app to be downloaded and that app needs to have been granted specific permissions. 

?For this hurdle, incorporating beacons into Facebook makes a lot of sense,? Ms. Lowy said. ?The Facebook app has already been downloaded on many devices. The site's longstanding reputation also makes consumers more likely to grant it access to their location,? she said.

Final Take
Michael Barris is staff reporter on Mobile Marketer, New York