Imagine you are shopping in your favorite grocery store. As you approach the dairy aisle, you are sent a push notification in your phone: “10 percent off your favorite yogurt! Click here to redeem your coupon.” You considered buying yogurt on your last trip to the store, but you decided against it. How did your phone know?
Your smartphone was tracking you. The grocery store got your location data and paid a shadowy group of marketers to use that information to target you with ads. Recent reports have noted how companies use data gathered from cell towers, ambient Wi-Fi, and GPS. But the location data industry has a much more precise, and unobtrusive, tool: Bluetooth beacons.
These beacons are small, inobtrusive electronic devices that are hidden throughout the grocery store; an app on your phone that communicates with them informed the company not only that you had entered the building, but that you had lingered for two minutes in front of the low-fat Chobanis.
Most location services use cell towers and GPS, but these technologies have limitations. Cell towers have wide coverage, but low location accuracy: An advertiser can think you are in Walgreens, but you’re actually in McDonald’s next door. GPS, by contrast, can be accurate to a radius of around five meters (16 feet), but it does not work well indoors.
Bluetooth beacons, however, can track your location accurately from a range of inches to about 50 meters. They use little energy, and they work well indoors. That has made them popular among companies that want precise tracking inside a store.