Location-based mobile applications poised to take off

Location-based mobile application adoption is poised to take off, given technology improvements and cost reduction.

The Los Angeles County Museum of Art is a sprawling seven-building complex with 3,000 pieces of art, from African sculpture and Asian prints to European oil paintings. Fortunately, visitors can now get context-sensitive directions and exhibit information on Androids or iPhones. In early 2014, the museum added Bluetooth beacons that sense and communicate with a LACMA application on visitors' cell phones, sending messages about the exhibits and events happening near them.

"We had a problem with people losing their way, so when beacons and context-aware technology became available recently, we began looking for the right way to do it," explained Amy McCabe Heibel, vice president for technology and digital media at LACMA, who estimates that 75% to 80% of the museum's 1 million annual visitors have smartphones and about one-third have downloaded the museum's mobile app so far.

LACMA's experience is emblematic of the uptake in organizations' use of location-based mobile applications. Technology improvements and cost reduction have played major roles in boosting usage.

Bruce Krulwich, a consultant at Grizzly Analytics, which researches mobile technology developments, said that location-based applications will take off over the next two years, thanks to a combination of factors: the entry of brand-name vendors Apple and Qualcomm, the declining price of beacons (to as low as a few dollars each), more sophisticated technologies coming onto the market, and the variety of potential applications.

The LACMA system, for example, comprises Qualcomm's Gimbal beacons that use Bluetooth's low energy (BLE) standard to sense visitors entering and leaving a room. A custom application developed by LACMA and Eventbase Technology sends context-aware messages, along with providing general museum information and maps. LACMA launched the app three years ago but added Bluetooth messaging only this year.

The advent of BLE for indoor geofencing and context-sensitive messaging are two technology improvements that may spur greater interest in mobile applications. That's because other approaches, such as Wi-Fi and GPS, aren't as precise indoors, and the classic iteration of Bluetooth tended to use up too much battery power, prompting people to use it sparingly, experts say.

"Wi-Fi isn't as accurate," said Sheryl Kingstone, senior analyst at the Yankee Group, a research firm focused on mobile technologies. "BLE has a very small radius, which improves its success rate."

Location-based mobile apps build brand, inform users, create community

Numerous companies are using location-based mobile applications to engage and educate customers surrounding products and services.

Krulwich estimated there are already dozens of deployments under way or finished at malls, large stores, airports, museums and exhibit centers. Examples include the Safeway and Giant Eagle supermarkets, which launched the service in 150 stores in January 2014, and Virgin Atlantic's use of beacons at Heathrow airport to enhance the service of its "Upper Class" passengers. Likewise, public events like the South by Southwest,or SXSW, technology conference in Austin, Texas, and the Tribeca Film Festival in New York City have deployed Bluetooth beacons to better engage and communicate with participants.

The Tribeca Film Festival's mobile app is intended to provide both real-time event information and a sense of virtual community for the attendees, who are scattered around the various venues in Manhattan, according to Matt Spangler, executive vice president of content. The mobile app alerts users of screening times and available seats, enables in-phone ticket purchases, and provides reviews and video trailers of films showing at the Festival. It also solicits feedback from people who have just seen a film.

In the future, Spangler would like to see directional tracking added to the beacons, to provide messages based on where the person is most likely going next.

"You know if someone is heading out of the theater, but not where they're going," he explains. "The future challenge will be adding direction, so you can make messages more relevant."

Because the beacons are small, ranging in size from a thumbnail to a bar of soap, hiding them around a room or a door is easy, Spangler and LACMA's Heibel said. The real work was creating the messages and setting up the rules for sending them. "You don't want to wear a person out with alerts or have people staring at their phones instead of the artwork," Heibel said.

As more companies delve into location-based mobile apps, the variety of uses will expand, as will the complexities involved in getting them to work with other applications, noted Bob Heaney, research director for Aberdeen Group's Customer-Connected Value Chain practice.

"It will go beyond having the hardware and into integrating it with the POS [point-of-sale] systems, and other systems that stores use," Heaney said.

Krulwich agrees: "The fancier the app, the more you will want to tie it to your customer service system or order systems, and the more difficult the effort will be."

But that isn't deterring companies from trying. According to Omer Minkara, principal analyst for the Contact Center and Customer Experience Management practice at Aberdeen Group, fully 14% of companies are currently using geofencing for customer engagement, while another 15% to 20% say they plan to do so. That includes all types of context-based messaging, not just beacons.

Given the interest level among vendors and the potential uses for context-based messaging in retail and other industries, experts say we shouldn't be surprised to see it heading for a store nearby in the months ahead.

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