Beacon deployment in China generates $16 million. dollaróin profit
In 2015, one of the most famous social media apps in China – WeChat with the total number of usersóin 600 million. – has entered the beacon market. Thanks to the integration of these tools, already more than 1000 storesóacross China have deployed beacons and adopted a marketing strategy based on this technology.
One of the companies thatóra has had tremendous success in this field, is a well-known jewelry brand in China – Chow Tai Fook (CTF). The company, which has deployed beacons in 237 locations, accounting for 10 percent. all storeóThe business model of the application is the same as in the case of the brand (2300+)óMany companies are increasingly looking for added value for the useróin this market – company Sensoro. Most importantly, the implementation has had a surprising effect, as the incomeód of this investment is about 16 million. dollarów. In today’s case study you will find out what strategy was adopted by the CTF company! 🙂
Business model
A typical business model using contactless technology consists of three elements: brand, beacon provideróin and application. In practice, the company deploys beacons e.g. in the store, customers need to install the app and then a push message will be initiated by a beacon and displayed on the user’s screen. In the case study of Chou Tai Fook, the three elements are: brand – Chou Tai Fook, the application – WeChat, provider of iBeacon technology – Sensoro.
WeChat was launched in China only 4 years ago. This application allows its users to communicate in the form of text, video or graphic messages, its equivalent in our market is WhatsApp or Facebook Messanger. However, the WeChat app is much more than just an instant messenger. Through it, the user can rózamóncrease the number ofówka, food, buy a movie ticket, play a game, check-in a flight, send money to a friend, orderóTo make a doctor’s appointment, pay the electricity bill, search for a coupon generated by a beacon or make a charitable donation – so many possibilities and only one application.
In addition, the WeChat application is róalso equipped with the function “Wallet”, która works like other wallets, except that it is synchronized with iBeacon technology.
WeChat therefore has a strategic advantage, because companies thatóThanks to the integration of these tools, more than 1,000 stores that implement contactless technology do not have to encourage their customers to use the applicationóMany companies are increasingly looking for added value in working with a key beacon provider to download a new application in order to receive their beacon signal. Instead, the messages appear on the WeChat app as a so-called “message”. “Shake”. CTF has just used this feature.
CTF strategy – Wechat and functionality “Shake”
When planning a beacon project, the beacon installation itself is not a major barrier, zaróboth financially and technically. What cannot be said for apps, for the cost of promoting apps, któThe challenge is to make the brand (2,300+ brands) work together with its potential users. So, overcoming this obstacle is a key challenge.
In China, this problem has been solved with the WeChat app described above, whichóleading the market in this area. In addition, users are aware of the function “Shake”, która is one of the elementsóin WeChat. Brand wspóworking with WeChat no longer needs to focus on promoting the app and instead focus on offering interesting couponsóin and encouraging customersóin order to use the function “Shake”.
Case Study CTS used WeChat with great results, but the business model definitely róis different from the traditional approach to beacon technology. And it looks like this:
First, coupons are not the message “Push” in the eyes of the consumer, but “Pull” thanks to the “Shake”. Process “Pull” The results are as follows:
Step 1: The user opens the WeChat app and then clicks on the function “Shake”.
Step 2: When in range of the beacon, a green icon appears in the bottom left corner.
Step 3: The user’s task is to shake the phone and the coupon will appear in the middle of their screen.
Step 4: The user clicks a button on the screen and a message appears with a promotional coupon to redeem.
The WeChat app uses the model “Pull” instead of “Push”, this happens róIt is also because it is a social application, which obliges its twórcóin order to behave appropriately “image”. It seems that this model works well in practice, plus when a person finds themselves in the company of other peopleób, któIf they shake their phone, they are automatically motivated to do the same. This is one of the factorsów, któWe will never receive a message using “Push”. And thanks to the fact that a single “Shake” can lead to receiving more couponsów, people repeatedly shake their phones, which increases the average engagement rate.
It is worth mentioning that the user information is completely hidden in the WeChat application. Brands only have access to “unique user ID”, This means that they know that the same personóBy “Shake” on their phone, but do not have access to the rest of the data – name, gender or age. On the one hand, the user is anonymous, but from the brand’s perspective, this limits its ability to analyze customer data and preferences.
CTF strategy
CTF brand covered 237 of its stores with a beacon campaignóa in Beijing, Shanghai, Shenzhen and Guangzhou from February 6 to March 13. At that time, 32,712 customers had participated in the coupon promotionów. The total number of “Shake” was 152,325 times. The average number of “Shake” per person is 4.76. By using the “Shake” 34,633 vouchers were sentóof which 20,562, or 59 percent, were sent. has been realized. The profit generated from the coupons redeemedóin a reach of 16 million. dollarów. This result is definitely impressive, and reaffirmed jewelry brand CTF’s effectiveness of proximity marketing efforts, whichóra has already announced the continuation of the project and the deployment of beaconsóin the remaining 2,000 stores.