The Interactive Customer
Helping Stores and Shoppers Communicate on Site
When a customer logs on to Amazon, the company immediately knows she’s there and what her interests and past purchases have been. When the same customer walks into a traditional retail store, the retailer has no idea. Kevin Beals ‘95 is working to change that in ways he hopes will benefit both business and customer.
In 2010, drawing on their experience in Wi-Fi startups, Beals and Bryan Wargo ‘95, both Santa Clara University alums, decided to turn their expertise to the retail world. Along with fellow Santa Clara grad Mark Jamtgaard ‘95 and engineer Nate Mueller, they launched Nearbuy Systems, with the goal of helping conventional retailers use Wi-Fi and mobile devices to communicate with customers while they are in the store.
“We see ourselves as bringing e-commerce analytics to brick-and-mortar stores,” Beals says. “E-commerce retailers constantly track their customers and know much more about them, but in a conventional store, the customers aren’t visible to the store until the time of purchase, and only then if they use a credit card.”
“It’s easier to start a company now than it was 10 years ago, with all the technology such as wireless networks, cloud storage solutions and Gmail.”
The key to doing this without running afoul of privacy issues, he says, is to create an opt-in system in which the customers use the store’s Wi-Fi, which then alerts the store to their presence. Anyone concerned with privacy, or who doesn’t want to communicate with the store while in it can simply not use the store’s Wi-Fi system.
An example of how this might work would be that a customer comes into a large department store and logs on to the guest Wi-Fi network. The store could check the customer’s records, see that the person bought a certain brand of shoe there a while back, and send a text message advising that the same brand of shoe is now on sale.
Beals says that research shows that 50 percent of all retail sales today have some Web influence — that is, people have researched either the product, the retailer, or both, online. Because people are using the Internet as a shopping aid, stores and customers can benefit from interacting online, even when the customer is inside the store.
“We think the outcome of this will be a better shopping experience for the customer,” as well as a benefit to the retailer, Beals says. “It will take some time for people to get used to interacting with a retailer on a mobile device in-store, but we think they’ll get used to this and not mind the privacy issue.”
At the end of 2013, RetailNext, another private company specializing in comprehensive in-store analytics, purchased Nearbuy. It’s a great fit, Beals says, because the two firms are doing similar but not overlapping work. He is staying on with RetailNext as vice president of finance.
When Beals graduated from Santa Clara University with an accounting degree in 1995, the last thing on his mind, he says, was starting a business. He started his career in public accounting at Frank Rimerman & Co., a regional accounting firm that mostly worked with private companies.
“I wanted to provide value,” he says. “We had a consulting arm that worked with smaller companies, helping them do what they needed to do to be entrepreneurs.”
After four years of public accounting, he caught the entrepreneurial bug himself. He and Wargo started a company called 2Roam. In those pre-smart phone days, they aimed to enable companies to make the most of their wireless devices. They developed a plan for EBay and took it live in seven countries. At one point they had 150 employees. Then the dot-com crash hit.
“Some days it seemed we could do nothing wrong, and other days it seemed we could do nothing right,” he says. “It was an amazing first experience for us.”
They sold 2Roam to a competitor, after which Beals moved on to a startup called Airwave Wireless, a hotspot provider that evolved into a Wi-Fi management business. In 2008 it was acquired by Aruba Networks, and he stayed with them until 2010, serving as worldwide sales controller before leaving to start Nearbuy.
He also is serving on the advisory board of the Center for Innovation and Entrepreneurship at the Leavey School of Business, an experience he says both energizes him and reminds him of how the entrepreneurial world has changed in the past two decades.
“I really enjoy being a part of it and seeing how many young entrepreneurs there are now and the amazing things they’re doing,” Beals says. “It’s easier to start a company now than it was 10 years ago, with all the technological advances such as wireless networks, cloud storage solutions and Gmail.
“When we started 2Roam, we had to spend a significant amount of money on back-end infrastructure in order to do our jobs. Now you hardly need to buy anything. Instead, entrepreneurs are able to focus their attention on what they are good at — innovating.”