Facebook wants to be inside every restaurant. Quite literally.

As of late, Facebook has been rolling out the Facebook Bluetooth beacon program and asking select Facebook page admins of local businesses to participate. In this program, Facebook provides a Bluetooth beacon to be placed in a local business, such as a restaurant or bar. The beacon then communicates with customers’ smartphones when they are at the location, displaying content on Facebook about that business.

Through Facebook’s smartphone app, a customer might receive a welcome note/photo from the business, prompts to like the business’ Page, posts from the Facebook Page or their friends’ recommendations. In theory, these beacons will enable Facebook marketing to occur on site, increasing brand awareness and hopefully, customer engagement.

The beacon is free, but at this point, Facebook has not signaled if the business owners will have any control over the content that is broadcast from the beacon. Facebook has characterized the current offers to participate as early access. Yet, Facebook has been testing these beacons since January 2015. The original announcement in early 2015 described the page of content as ‘Place Tips’.

Why is Facebook Doing It?

We do not know definitely what Facebook’s motivations are with these beacons, as the main beneficiary at this point would appear to be local businesses. Certainly, Facebook would not send out thousands of beacons without recognizing a way to help their bottom line or improve their position in the marketplace.

We ordered these beacons for many of our clients, but there are some caveats anyone who is considering setting up these beacons should know. As Facebook’s plans are still shrouded in mystery, restaurant owners should only participate if willing to pay attention to how the program develops. Don’t set up a beacon and forget about it.

We can speculate why Facebook might want to install a beacon in local business.

The first possible motive is by selling advertising to that local business. Although now Facebook promises to broadcast content for free, there could be a day that Facebook starts charging local businesses for access to customers’ smartphones.

Secondly, we are in the age of big data, so Facebook may only be collecting location specific information about Facebook users. Information on purchasing behavior is lucrative, and Facebook may be attempting to improve their advertising platforms by knowing what local businesses individual customers go to.

Lastly, Facebook is behind Google in regards to linking people with the places they visit. The success of Google Maps & Google+ Local gives Google a huge head start in finding geo-specific patterns. Essentially, Google runs Local Search, giving it substantial power in the market. Facebook Beacons may be a way to catch up and build up enough content that Facebook users will look for local businesses on Facebook.

Will Customers Opt In or Opt Out?

Bluetooth is the X-factor. Bluetooth may not be a new way for devices to communicate. It though has evolved and perhaps, will be adopted more in the future. But it remains an open question if customers will enable their phones’ Bluetooth to connect with Facebook beacons, especially as they will be surrendering some privacy.

In the past few years, we have reviewed loyalty programs that work through Bluetooth. In those loyalty programs, being in range of the Bluetooth beacon was enough to activate the app and reward customers. Unfortunately, these loyalty programs weren’t as effective as hoped. The weak link was that only a small fraction of smartphone users actually keep Bluetooth on (10% approximately). That is because Bluetooth, unlike WiFi, has had its share of problems.

Initially, Bluetooth was bogged down with a limited number of uses and a shopping list of security issues. Once it didn’t take much to listen in on a private phone call through Bluetooth’s security vulnerabilities. Much of that is in the past and Bluetooth is experiencing a resurgence from an unlikely source: wearables. The iWatch & Android Wear rely on secure Bluetooth to exchange information with smartphones.

So Bluetooth’s early missteps are not the end of the story. Newer Bluetooth standards are the preferred method of connecting a smartwatch connect to a smartphone. With smartwatches limited capabilities, linking up with smartphones are key to the usefulness of smartwatches. If wearables become ubiquitous, everyone may have their Bluetooth to tether to their smartwatches.

But with the privacy concerns, it is anyone’s guess if this program will actually work or cause a backlash. It may be disruptive for customers to receive unprompted information through their Facebook app just by showing up at a restaurant. And in the beginning, restaurants will have to make sure that the beacons do not reflect badly on the business.

Facebook’s Bluetooth beacons, however, are an interesting experiment and at this point, a restaurant can benefit from broadcasting to customers inside the restaurant. Nonetheless, realize that signing up entails that a restaurant keeps up with how this program develops. We plan on publishing an update on the performance of these devices once they are installed in some restaurants.