Bluetooth Mesh Networks for Retail

Disclosure: I currently work for SK planet, a wholly-owned subsidiary of SK telecom, one of the companies which sets Bluetooth standards.

The Bluetooth Special Interest Group (SIG) confirmed the introduction of new standards to support mesh networking via bluetooth. There were a few startups like Ubudu and Zuli.io that didn’t wait for the standards and these innovators are the first-movers in creating futuristic customer experiences with bluetooth mesh networks. Now that the standards are out, and it’s a watershed moment for IoT.

Bluetooth Beacon Mesh Networks

A mesh network could hypothetically extend the range to whatever distance you need. When a beacon is stand-alone it can advertise itself up to a few meters. Even with two-way communication (transmitting or receiving small packets) the potential utility of the beacon is limited to hyper-localised use cases. For example, while near a beacon in a store the client can request specific information about that location from the server; or, perhaps I could use my phone to turn on/off a lamp while near that lamp.

Bluetooth Smart Mesh Network

A mesh network allows me to extend the range by linking the beacons together. It accomplishes this in two ways: 1) by routing directly to a beacon somewhere in the network to enable a specific experience (e.g. turn-off the kitchen lights downstairs); or, 2) by flooding the entire network or a subset within the network to create an experience using multiple beacons (e.g. set living-room to mom’s profile). Using a mesh network subsets can also be created allowing for unique experiences for connected devices within a specified subset of the network.

Futuristic Consumer Experiences

Smarthomes have been all the rage for a couple years now, and the new standards for mesh networks will accelerate that. However, there are some exciting opportunities for retail consumer experiences as well. Here are a few ideas for implementing bluetooth mesh networks for in-store experiences.

Custom Subsets or “Rooms”

Custom subsets are probably the most well known IoT use case that leverages a mesh network of beacons. This is the oft given example of Smart Homes: dad walks into the living room, the lights dim and TV switches to Bloomberg News. The living room is a subset within the network, and the settings of all devices within that subset can be adjusted to fit the preference of a user. Additionally, a hierarchy of users can be created (i.e. Dad overrides son) and those settings can be engaged simply by walking into a room.  

Experiences Adapt To You From Room To Room

In retail, you can easily imagine this being used to create unique experiences at furniture, luxury audio and video showrooms. The question remains, how is this triggered? An end-user with a smartphone application is the answer most of the time today. Whether or not the use is a customer or salesperson is another question. On the one hand, the lure of customising your own experience while in a showroom could tempt customers to download your software, it may be more efficient to create software for clienteling.

Shopping Efficiency

How much time have customers wasted trying to find products within large department stores, shops within large shopping malls, or the toilet? Networked signage could be used to assist customers and make their journey more efficient. A customer could select the target destination within an app on their smartphone or on a digital sign. As he travels through the store or mall, visual cues can be triggered to guide the customer on his journey. 

Signage Alerts When You Arrive

These cues can be in-app via notifications (“you’re going the wrong way”) or via digital signage (“Customer XYZ here is your destination”).  In this use case, a mix of proximity technology like geomagnetics or wi-fi would be the best way to guide customers. However, incorporating visual cues will reassure customers and probably create new opportunities to surprise and delight them.  

Personalised Signage & Electronic Labels

Networked Signage and Electronic Labels are another opportunity for retailers and customers. A label which displays a price with e-ink can dynamically display discounted prices to customers subscribed to loyalty programs or with a digital coupon. In fact the packet-size of data needed to display a price is small enough it should be possible without the internet. A networked electronic labels could dynamically generate prices for a section of a shelf, so customer can compare discounts on multiple brands.

Dynamic Prices On Electronic Labels

More dramatically, personalised media could be presented to customers at any digital sign. Digital Signage connected to a mesh network could request content from the cloud via the network.  

Dynamically Adjust to Audience

With enough connected signage and labels, retailers could abstract further to create experiences for audience types. For example, customers of a given profile at a given time of day within a given store could tend to coalesce within a certain subset of a mesh network. At the same time another group of customers of a given profile could coalesce within another subset.  This would allow for digital experiences within either subset to be tailored for those audiences.

Flooding Subsets To Adapt For Audience Profiles (Green vs Orange)

In Conclusion

Without a doubt the experiences retailers can create leveraging bluetooth mesh networks will be essential to the success of their mobile software. A few technology startups like Ubudu and Zuli, as well as large companies (SK telecom among them) are already moving to make bluetooth mesh beacons a commodity. Digital Signage will be the obvious choice for retail, but the real question will be what unimaginable use cases will creative marketers invent for mesh beacons? I’m not simply referring to engaging content on a screen, but beyond that what new devices will we connect and how will they create more value and efficiency?

Are Self-Published Authors Earning $1 Billion on Amazon?

Amazon began as an online bookstore. Books were Jeff Bezos answer to the questions “What obvious thing do you know that no one else knows?” He knew there was a longtail of demand for books, that there were people frustrated because either they couldn’t find the books they wanted at their local bookstores or they couldn’t find them quickly. He knew there was a longtail of supply for books, that there was potentially an infinite number of books to fulfill that demand. And he knew people would flock to his webstore if he could provide a solution to connect demand with supply better than anyone else.   

While the Everything Store is supposed to have been founded on the premise that the internet would make it easier for consumers to find “Everything” at a lower price, books were the perfect proxy for “Everything.” Books presented a clear problem for both mainstream and niche consumers which could be solved, presented a nearly endless longtail and an eternal shelf-life.

Today the longtail is growing in influence as the power-dynamics of publishing is shifting away from major publishers and into the hands of authors.

The Endless Longtail of Books

The Association of American Publishers (AAP) is “the largest U.S. trade association for the consumer, educational, professional and scholarly publishing industry.” They have for years been tasked with creating standards for publishing, keeping tabs on the book selling industry, and hosting events that bring the industry together to maintain a community of publishers, authors, and distributors. AAP represents publishers, and reports on their performance based on platform (print, or digital) and category monthly and annually. Last year they reported that eBook sales are in decline, and infact they were for publishers.

But the real story here was not that publishers represented by AAP are reporting a decline eBook sales; rather, how consumers are choosing to buy independently published eBooks. Fortune, in response to a NY Times article publicizing AAP’s sales statistics as a “plot twist” (that eBooks were in decline while print sales were improving), reported that according to independent industry analysts at Author Earnings the market for eBooks is relatively stagnant though long-term trends favor eBooks becoming dominant over time. What’s remarkable is not the struggle between digital and print, but rather that independent publishers… or self-published authors… now sell more eBooks than the Big 5 publishers who have traditionally dominated book sales.

The ascension of “indie publishers” indicates that a) consumer demand for niche books continues to be strong, b) the quality of indie published books has been or is being syndicated by the masses.

The Writing on the Wall

This shift in dynamics is going to accelerate as consumers earn more trust in authors selling to them directly. Authors already prefer to self-publish in-theory because they can earn substantially more. Selling directly through Amazon means pocketing 70% of the cover price. Selling through a publisher authors typically get 25% of their publisher’s net (for eBook sales). However, cutting out the middleman today still represents an opportunity cost to authors seeking shelf-space offline where 70% of book sales still happen, not to mention abandoning the prestige of making the NY Time Best Seller list.

Arguably many authors today will earn more by sticking to self-published eBooks, but making the NY Times Best Seller list as a self-published author is still unlikely as is getting a deal to produce a major motion picture based on your work. But the dynamics are changing and The Martian is timely example of this, having become both a best seller and a major motion picture. 

The Martian was a self-published serial novel that just got traction. Its popularity online caught the attention of Crown Publishing (a division of Penguin Random House) and the rest is history. Success stories like The Martian will certainly inspire more writers to self-publish directly to their audience rather than submit to the complex and onerous demands of the publishing industry.

Better for Consumers and Authors, and Publishers?

Consumers win in this new paradigm of publishing. It means more choice from an increasingly wide range of authors and genres, at a lower cost. Authors win because as they build trust with consumers the more willing those consumers are to pay a few bucks to download their eBook. In fact, authors are set to gain tremendously from this new dynamic. Based on my own back-of-the-envelope estimates self-published authors are approaching $1 billion in revenue on Amazon.

Statista estimates eBook Sales totalled $6.74 Billion in 2015, of which Amazon controls 71% (according to some estimates) giving them $4.79 Billion in eBook Sales. Averaging the percentage of sales per category reported by Author Earnings from January 2015 through January 2016, Indie Published and Uncategorised Single-Author Publishers represent 24% of sales or $1.14 Billion.

Assuming those authors pocket 70% of the cover price, self-published authors earned approximately $800 Million selling on Amazon in 2015.  

The question remains whether this will be good for publishers? Clearly it is a better model, allowing consumers to syndicate books first means a more democratic vetting process, less overhead, and higher chances a book will hit the best seller lists once it’s picked up. But that could be temporary, over time the publishers could simply become irrelevant.