Location-based technology is opening up a whole new world of opportunities for marketers to communicate with customers in real-time, called geomarketing. New capabilities and uses emerge every day – such as geotargeting, geofencing, and geofilters.
Geofencing is one of the most common ways that businesses enter the world of location-based marketing. Put simply, geofencing is the process of defining a geographic boundary – imagine a virtual fence – around a location, using the global positioning system (GPS) or radio frequency identification (RFID). Depending on your needs, the area can be as large as an entire city or as small as an individual building.
Once a boundary is established, marketers can set up triggers to send a text message, email, or app notification to mobile devices that enter or exit the area.
Why would businesses want to use geofencing?
The ability to section off a specific geographic area and communicate with customers within that boundary allows businesses to engage customers with hyperlocal messaging. Marketers often use geofencing to target customers in close proximity to their business – but they can also use the technology to promote messaging for special events or serve up an advertisement when customers pass by a competitor’s location.
Geofencing also allows you to track and collect information about your customers’ offline behavior, which can be used for audience segmentation, personalization, and retargeting. Purchase history, demographic data, and other insights help ensure your marketing communications are relevant to your customer.
Certain data, like local sales, can be difficult to track. But when your customers use promotions sent to them via geofencing, there are metrics you can measure. You can see what they bought, how long they spent in your store, or how often they visit your business – all of which can be used to inform and personalize your future marketing strategy.
How can you incorporate geofencing into your marketing strategy?
In-app messaging. Research from Apptentive shows that on average, only 25 to 40% of new customers will relaunch an app after the first week. Keeping users engaged and interested in your promotions can be rough. Geofencing allows you to tailor your messaging to a customer’s location and past behavior.
When a customer opts-in to use location services, you can send messages with geofencing via your app to those customers. Imagine if you could push a savory recipe for Massaman Curry as your customer wanders down the international foods section at the grocery. You could even offer a coupon alongside the recipe as another incentive for the customer to stop and shop.
To get customers to opt in, it’s important to focus on awareness. Let customers know at checkout, via in-store signage, on social channels, or in an email that they need to download your app andenable location services to receive special offers and discounts.
Mobile ads. According to Search Engine Watch, only 22% of businesses say they’re using hyperlocal targeting, such as geofencing, to its full potential.
When you consider that 51% of smartphone users have discovered a new company or product while conducting a search on mobile, that could mean you are missing out on a huge opportunity to out-advertise your competition.
Many marketers are exploring the option of using geofencing to promote their company at events, like trade shows or conferences. For the duration of the conference, users are served a mobile display ad whenever they conduct a search on their smartphone, as long as they are within the defined boundary. These ads can invite customers to visit the company’s booth, attend a special presentation, or check out the website.
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