One of the challenges marketers have in today’s content-saturated world is to deliver their messaging at the most effective time possible. Sending a costumed employee to stand out on the roadside might not align with every brand’s image. That being said, there are strategies that businesses can employ to digitally wave down customers in the vicinity of their business location.
Geofencing – what is it?
Geofencing is one such location-based service. Geofencing refers to drawing a virtual boundary around a location. Then, an app or other software uses GPS, RFID, Wi-Fi, or cellular data to trigger a pre-programmed action any time a mobile device or RFID tag enters or leaves that virtual boundary. By using users’ IP addresses, brands can push out ads to computers, tablets, and mobile devices to target their audience with timely messaging.
Depending on how a geofence is configured, it not only delivers location-based marketing, it can also prompt mobile push notifications, trigger text messages or alerts, send targeted advertisements on social media, allow tracking on vehicle fleets, and even disable certain technology. Through coupons, notifications, engagement features, and security alerts, businesses are finding creative ways to leverage these virtual boundaries.
It is worth taking a moment to differentiate between geofencing and geotargeting as people sometimes use these terms interchangeably when they are actually distinct targeting strategies. Geotargeting refers to delivering ads to people who are not only inside a defined boundary but who also meet a specific targeting criterion. Brands can geotarget based on demographics, behaviors, or interests in addition to a user’s location. This type of targeting tends to be more effective for larger geographical audiences than geofencing because of the other specifically defined criteria.
How does geofencing work?
First, a virtual boundary is established around a specified location in GPS- or RFID-enabled software. This virtual geofence will then trigger an established response any time an authorized device enters or exits that area. Since users need to opt-in to location services for the geofence to work, they are most often defined with the code of a mobile app. For example, a retailer might draw a geofence around its locations so that mobile alerts are triggered when customers who have downloaded the retailer’s mobile app enter or leave the “fenced in” area. It should be mentioned that users can always opt to decline location access for the apps they download to their mobile device.
How can geofencing be used?
Once a geographic area has been defined, there are a number of ways that companies can utilize this strategy to communicate with their target audience.
Popular social media apps are known for their use of geofencing. For example, Snapchat has location-based filters, stickers and other shareable content that are made possible via geofencing. The virtual perimeters established by a geofence are what allow you to use a promoted filter at a sporting event, a custom-made filter for a friend’s wedding, or add to a public, location-based story.
Some retail and hospitality businesses will set up geofences around their competitors’ locations. When a loyal customer approaches the competitor’s boundary, he receives a push notification prompting him to visit the other business. Brands might even set up the geofence so that a coupon is pushed to that consumer’s device in an attempt to further dissuade him from doing business with the competition.
Geofencing can be used to engage large numbers of people at organized events such as concerts and festivals. For example, a Renaissance Fair might use a geofence to crowdsource social media posts or deliver information about their venue and special events that are happening.
Any tips for implementation?
First and foremost, it is important to understand your target audience – who they are and where they spend their time. The goal of geofencing is to put the right information in front of the right people at the right time. According to the 2018 U.S. edition of Deloitte’s Global Mobile Consumer Survey, smartphone users check their phones an average of 52 times per day. By understanding how your customers shop and use their mobile phones, you can send the most relevant content at the best time and benefit as much as possible from your geofencing campaign.
Start slowly and establish one geofence that encompasses your business location, your parking lot, and surrounding businesses. This will ensure you are capturing the largest audience possible. If you have multiple, physical locations, provide customized messages for each location to ensure that customers aren’t disappointed when they show up at the wrong location expecting a sale or event.
Track the results of your geofence to understand the impact, brainstorm around any challenges, and then set up another geofence. You can place them near your competitors, as mentioned above, or place one near a complementary business. If you sell custom pet accessories, consider setting up a geofence near local veterinarian offices, groomers, or other retailers that cater to pet owners.
Messages sent to customers entering or leaving a virtual boundary should be short and concise. Geofence messages are typically limited to 100 or so characters anyway so it is important to state your point as simply as possible. That being said, it’s a good idea to leave enough characters to allow you the opportunity to include a call to action in your message.
Action is key. The last thing you want is for customers to read a statement message, think “huh”, and move on with their day. So, include a brief, location-relevant call to action. “Tap Here for More” gives customers a reason to further engage with your brand and increases your convincing them to head towards your store. For more about creating impactful calls to action see our article:
Geofencing requires a bit of strategy that includes being where your customers are, not just around your location. Understanding customer behavior can greatly improve the effectiveness of your efforts. Build some of your geofences around larger venues like sporting arenas, airports, and shopping centers.
Bigger isn’t necessarily better. As a rule of thumb, the perimeter of a geofence should target consumers within five minutes of the target location. While your virtual boundaries can be of any size or shape, anything outside of a quick travel time reduces the relevancy of local messaging.
Speaking of relevancy, be relevant. Messages sent out to targeted consumers based on their location is only the first part of it. Ensure your message is relevant by delving into geotargeting strategies and segmenting messages based on consumer demographics, behaviors, and interests. You can also use other parameters such as breaking news or weather conditions to keep your content updated.
Are there privacy concerns?
Geofencing technology offers serious potential across a number of different industries but also offers serious privacy problems if not properly handled. The tracking involved in geofencing can collect more personal data about users than originally intended. It can reveal a possibility of medical issues if someone is regularly entering a geofence set up near a hospital or a religious preference when a geofence is in close proximity to a place of worship.
Used by entities willing to cross ethical lines, a geofence can also be triggered to cause mental harm. A recent example of this comes from Massachusetts where the Attorney General blocked an ad campaign from Copley Advertising, which was hired by a Christian organization to set up a geofence around women’s health clinics that would target women in the waiting room or nearby with anti-abortion ads. This action resulted in the State of Massachusetts becoming one of the first states to enact a consumer protection law that objected to the use of location-based advertising.
Despite questions about Privacy, it doesn’t seem that geofencing will lose its traction anytime soon. Referring to “technological advancements in use of spatial data and increasing applications in numerous industry verticals,” Markets and Markets shared a projection that the geofencing industry will grow over 27% by 2022.
The experts at Strategy Driven Marketing are all about data. We’d love to deep dive into your business to understand your organizational goals. We can help you determine and execute location-based marketing strategies that will let you recognize progress towards those goals and identify challenges along the way. Contact us today to set up a consultation. Let’s get started!