Location technology pushes offers to Air Miles collectors’ smartphones

If you feel a vibration in your pocket next time you walk into a Rexall in Toronto or a Staples in Alberta, don’t worry. It’s just your Air Miles app.

Air Miles is piloting its beacon technology that, when you enter a store, sends a message and personalized offers to your smartphone via the Air Miles app – as long as you’ve opted in for location-based services, of course. The pilot, underway now, follows on the loyalty program’s pilot last year with geo-fencing as a longer-range location-based marketing solution.

“We’ve been monitoring mobile technology for quite awhile, and we see it as a crucial part of our customer mix today, and into the future,” said Emmie Fukuchi, vice-president of product development at Air Miles.

With last year’s geo-fencing pilot, Air Miles delivered messages when a user was from 500 metres to one kilometre away from a store to see how it would impact users, and Fukuchi said the response was good. Now with beacon they’re sending a message to a user when they’re within a few metres of the beacon, generally as they enter the store.

“We want to see the customer reaction, how we can deliver value for the consumer and the retailer, and how we can enhance the retail experience for them both,” said Fukuchi.

She stresses everything is optional. The customer has to have downloaded the application, and proactively opted into both push notifications and location-based services – and they can opt out at any time.

During the test period, when a customer who has opted in walks into a participating Rexall or Staples, they will get a push notification welcoming them to the store and informing them of the offers available. Fukuchi said they’re testing a high fidelity media solution that allows Air Miles to deliver a push notification as a text that, when you click it, delivers calling cards with messages or offers.

This person received a special offer via location-based technology — and needs to charge their phone.


“The offers could be specific to their spend or to a category, they can choose to delete an offer or save it to access later, and they can identify those most relevant to them and act on them,” said Fukuchi. “We’re rotating offers weekly testing to see which offers, and what frequency, makes most sense.”

Air Miles is in the early stages of asking for users to opt in to location-based technology, and has been focused on the geographies where the pilot projects are underway. So far, Fukuchi said about 500,000 people have opted into push notifications, a figure growing at about 20,000 opt-ins per month. She expects those numbers to grow considerably once the service rolls out nationally, and quotes global research that has shown 77 per cent of mobile users are willing to trade location for value.

Right now, to make the trade they’ll need to be using an Android or iOS handset. The Air Miles BlackBerry app doesn’t have many users and isn’t being updated, and Fukuchi said they’re waiting to see more traction from Windows Phone.

Air Miles is still designing the program around how location-based marketing will be offered to participating retailers behind the pilot phase; right now the focus is on testing infrastructure and learning best practices. One of those best practices, she stressed, is privacy.

“Privacy is critical to us so we never share collector information with partners or third parties,” said Fukuchi. “We do use it to deliver the best possible experience for our collectors, such as when to serve an offer – we’ll use it for analytics to drive personalization, but not in any other way.”

Air Miles expects to roll out geo-fencing more broadly within the next few months, while the proximity beacon-based piece will come later this year. Retailers will be able to choose which location-based technology they use to reach customers, but users will simply opt in to location-based services – Fukuchi said they won’t have the ability to set the range from store at which they’re willing to revive messages.

“We’ll me monitoring contact frequency,” said Fukuchi. “It’s not in anyone’s interest to overwhelm anyone with too many messages. We’ll be monitoring both the consumer value and the consumer experience, and working with different brands to help them prioritize and sequence messaging. And consumers can easily opt out if overwhelmed.”

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Jim Love, Chief Content Officer, IT World Canada

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Jeff Jedras
Jeff Jedras
Jeff Jedras is a technology journalist with IT World Canada and a member of the IT Business team. He began his career in technology journalism in the late 1990s, covering the Ottawa technology sector for Silicon Valley North and the Ottawa Business Journal. He later covered the technology scene in Vancouver before joining IT World Canada in Toronto in 2005, covering enterprise IT for ComputerWorld Canada and the channel for Computer Dealer News. His writing has also appeared in the Vancouver Sun & the Ottawa Citizen.

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