In a retail context, beacons are essentially Bluetooth transmitters that communicate with an authorised app when the device housing that app is within the vicinity. The technology uses electronic sensors in airports, stadiums and especially in retail environments to analyse consumer behaviour and enhance the customer experience. Retailers use them to promote discounts and personalised offers, and they are used to track in-store customers, analyse crowd and customer behaviour, and support contactless payments. The ability to direct messages in novel and unforeseen ways, however, has given rise to real privacy concerns.

Tracking and privacy concerns

Businesses have rushed to assure their buying public that privacy will be respected, but there persists a certain wariness among consumers. It is frequently difficult for users to discern what information is being collected or how it will be used.

To that point, even innocently signing on to a free Wi-Fi service can unlock personalised data, tracking users or mapping the relationship between them and others who visit a particular location. In 2012 Canadian authorities tracked travellers for days after they left a major airport where they used the terminal’s free Wi-Fi.

Privacy campaigners argue for a ‘opt in’ approach to tracking elements where retailers disclose how long they might store the data and whether they're merging it with other information to identify users. Similarly, assurance against data theft calls for serious attention from retailers as breaches in security are rife where technology and personal information meet. The most prominent recent example in the UK involved T-Mobile, which saw 15 million customers affected by a hack of personal data in autumn 2015.

Levels of identification

Beacon sensors can identify what is called the MAC address on a device and register its location without any apps or permission, but this doesn’t necessarily mean that the user’s identity is known. (On the other hand, it’s often not difficult to tie individuals to the MAC number either, which theoretically means that you can be identified without granting consent.) Typically, the ability to track customers directly becomes possible when the app associated with the beacon asks for specific permissions to use notification functions. Essentially, a phone tracks the beacon and if permission is granted (i.e. through the app), then the lines of communication are open. Many see beacons acting no differently to CCTV cameras; a silent monitor of online movement.

Have privacy concerns hindered use?

An Accenture poll from 2012 found nearly two-thirds of respondents in the UK and US prioritised the receipt of exclusive offers over misgivings about their online activity being tracked. Perhaps the most customer-focused arrangements are those that give users the choice.