You may have heard of the saying, “right place at the right time”. Well, that is true of geofence marketing.

Marketers have realised that modern customers desire more personalised interactions with brands. If you’ve seen a discount coupon suddenly flashing on your Facebook app while entering a shopping mall, you’ve experienced geofence marketing before.

Before we get technical, here are some interesting statistics:

Now let’s define a few terms.

Geofencing is the establishment of a virtual fence around a predefined geographical area. Whenever a user with an enabled mobile device enters this area, it triggers an action or notification. A geofence is a technology that defines a virtual boundary around a real-world geographical area. Geofencing marketing is a type of location-based marketing targeting an audience based on their location within a given virtual perimeter.

How does geofencing work?

Geofences work in 3 simple steps. First, a virtual boundary is created around a physical location. Next, a user (and their mobile device) will pass into the geofenced location. Lastly, it will trigger an ad to be served to their phone. This allows advertisers to target audiences with remarkable precision.

For instance, a retailer will set up a geofence where their store is located. When a customer who has downloaded their app enters the area, they get a push notification that lets them know of a deal at the nearby store. The possibilities are endless. See examples here.

Source: Moca Marketing

How does geofencing marketing work?

Geofencing marketing may seem complicated, but it’s quite simple especially when you bring on the best and brightest team to implement your strategy. In a geofencing marketing strategy, the marketing team develops advertisements and content tailored specifically to the customers within the geofence. When customers travel into these areas, they may receive alerts or notifications about your brand’s current offers, limited-time promotions, and events where they can interact with your brand.

If you are curious about geofencing marketing, you might want to ask yourself some of these questions:

  • Am I easily reaching my customer base with targeted messaging?
  • Am I happy with the level of awareness about my brand?
  • Am I spending my marketing budget efficiently?

If you answered no to one or more of the questions above, you might want to consider geofencing marketing and its many benefits. Even better, read our blog here.

What are the benefits?

Firstly, geofencing marketing allows businesses to deliver messages to the right customers at the right time.  Geofencing campaigns can be set up across multiple types of online advertising campaigns, such as search engine advertising, remarketing, and video advertising.

Secondly, geofencing offers personalised experiences. Who doesn’t like to feel special? Most people do – at least some of the time. Personalisation lets a customer know that you are paying attention to them. By enhancing the experience, they will love your brand offers, thus, leading to more sales for your business.

Another benefit is that geofencing allows you to collect data to increase engagement, and better understand user behaviour. It gives you information on what kind of offers interest your target audience, helping you alter your promotions accordingly. It’s an exciting technology that promises to further revolutionise business by empowering marketers to have a better view of what’s happening on the ground.

While you’re here: Drive business performance with data-driven marketing

With top players leading the way, more marketers will feel secure in adopting geofencing as part of their overall strategy, and the potential uses will continue to expand. Let’s look at an example:

Taco Bell

Taco Bell is a good example of a restaurant that has used geofencing for hyper-targeted, location-based marketing. They built a restaurant app with mobile ordering functionality. Whenever a customer drives by a Taco Bell location, they’ll get a push notification reminding them that they can order food from their phone and pick it up. Following its launch, this campaign enabled Taco Bell to increase its sales by 6%.

Suggested reading: Powering smart campaigns with behavioural marketing

Looking beyond privacy concerns

One of the most stringent regulations is General Data Protection Regulation (GDPR) and applies to all organisations that do business with residents of the European Union. GDPR does not let companies target users without explicit opt-in and has strict guidelines regarding the use and storage of citizen data. Businesses must be compliant with local privacy laws before rolling out a location-based marketing strategy. Consult with your legal team to get a better understanding of what can be pursued via your company’s marketing efforts.

Final thoughts

Geofencing is an excellent way to reach out to more customers. With this technology, you can provide timely and personalised offers to customers and lure them to your business in real-time. With many potential benefits, simply giving geofencing a try can prove to be a major step in the right direction for businesses looking to gain insights and build trust in local markets.

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