What is a QR code?

what is a qr code, what are qr codes, how does a qr code work

Estimated reading time: 6 minutes

There is a small matrix of square dots that can be found just about everywhere. On restaurant menus, next to products in retail stores, next to packaged food in supermarkets, on kiosks, on website pages, on business cards and postcards, and in television commercials and magazines. But, of course, we are talking about quick response (QR) codes. You have probably scanned a code recently to learn more about a particular product, connect to a business’s website to get a special discount or join a WiFi network.

Now that touchless technologies have become mainstream, the use of QR codes is increasing at a rapid pace. Small businesses and corporations alike are adding them to their marketing efforts to provide instant and relevant information to their customers and give them an advantage over the competition. If you run a small business and want to learn more about this technology, you have come to the right place. This Balboa Capital blog article features the ultimate guide to QR codes. We explain what they are, how they work, and much more.

Who invented the QR code?

The QR code was developed in 1994 by an engineer in Japan by the name of Masahiro Hara, as reported in the North Coast Journal¹. He worked at an industrial equipment manufacturing company and wanted to streamline the barcode scanning system. At the time, barcodes were limited in the number of characters they could have, so many products had more than one barcode, and, as a result, they had to be scanned multiple times.

Mr. Hara developed the concept of encoding information on a two-dimensional grid while playing a classic strategic board game. The QR code was originally for automotive parts and was later adopted by other industries like marketing, retail, healthcare, and manufacturing.

What is a QR code?

A QR code is a two-dimensional barcode that can be scanned with a digital camera or another device to read data and information encoded in the pattern of black and white squares or elements. The small elements in a QR code are referred to as modules. The size of the QR grid (in modules) is determined by the amount of data and information that needs to be encoded. The sizes range from 21 x 21 modules to 177 x 177 modules, and the maximum numeric data capacity is 7,089 characters or 4,296 alphanumeric characters.

For example, a QR code that links to this Balboa Capital blog post requires a grid with a small number of modules. Next, a movie theater that lists showtimes for 18 movies and includes links to movie studio websites and movie trailers will require a QR code with significantly more modules. The reason is that far more data and information are embedded.

On the comeback trail.

In the early to mid-2000s, QR codes were thought to be the next big thing in the marketing and business worlds, but their acceptance and utilization depended on the number of people who owned smartphones with built-in QR readers. In addition, only a fraction of the population understood QR codes and how to use them.

Today there are hundreds of million of smartphone users in the United States, and most smartphones are equipped with technology that allows users to scan codes in a matter of seconds. The scanning process is easy; you open the camera or QR reader on your smartphone and point it at the code. It will highlight a link and take you to the intended destination, such as a web page, menu, or product page.

How small businesses can use codes.

A QR code is a quick and easy way to connect with customers. It is also an inexpensive marketing tool that can be used alongside other digital marketing efforts to amplify a company’s reach and visibility. The benefits of a QR code are that it is easy to scan and offers immediate access to additional information about the product or service being provided. When shoppers have real-time access to product and service information at their fingertips, they are more likely to make purchases.

Marketing-savvy businesses are taking their QR codes further by including discounts, deals, special promotions, and other exclusive content. As a result, retailers can generate revenue from QR codes which helps offset the cost of running a loyalty program using traditional media like print advertisements and direct mail. QR codes can even be integrated with certain customer relationship management (CRM) software systems.

How QR codes are generated.

Many free and paid QR code generators are online, and many website-building platforms are equipped with them. But before we explain how to create one, let us explain the two main types of QR codes: static and dynamic. The primary difference between these two types of codes is that a static code cannot be changed in the future. So, if a business creates a static code and prints it on marketing materials, the embedded content and link will always stay the same.

A dynamic QR code, however, allows for more flexibility. Its backend can be edited as often as the business owner likes, and it will always provide users with the most up-to-date embedded content. So, if a business prints a dynamic QR code on marketing materials and wants to introduce a new product or promote a sale, the changes can be made on the fly.

Now that we got that out of the way, let’s discuss how to create a QR code. As we just mentioned, there are a number of free and paid options. Most of the paid services offer monthly or annual payment plans, and they have online portals that let you create QR campaigns and customize them to your liking. Some paid platforms also have advanced analytics reporting for dynamic codes.

Four places where businesses can place QR codes.

1. On the outside of a business

This is a great way to get people into a business to look at what it has to offer. QR codes can be printed on window signage, banners, and fold-out signs.

2. On the inside of a business

This provides customers with directions around the store or even lets them know about specials or discounts a business is running at the moment.

3. On flyers/postcards

Codes can be scanned by those interested in what a business offers, so it’s another way of getting people through the doors without even needing them to download an app.

4. On business cards

A code on business cards is a great way to differentiate from other companies and communicate with customers.


QR codes are a great way to increase the visibility of a business, and they can be used in many different ways. They can be applied to anything from product labels to building signage. Plus, their consumer usage has increased in the last five years, so this trend appears to continue.

1. https://www.northcoastjournal.com/humboldt/a-brief-history-of-qr-codes/Content

Balboa Capital, a Division of Ameris Bank, is not affiliated with nor endorses the North Coast Journal. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.