Geofence marketing – a new stage in the evolution of consumer marketing

Geofence marketing is a relatively new trend in digital marketing based on the principle of geographic boundaries. If your company is still weighing the pros and cons of the geofence, then we advise you to read today’s article. Just fifteen minutes of spent time will help you understand the features and establish the benefits of geofence marketing.

What is Geofence?

If we consider the general approach to the concept of “geofence”, it is considered in the context of the operation of the GPS satellite monitoring system. A geofence is a virtual boundary of a geographic space delineated on a map using technical means. An object leaving the territory or crossing the perimeter at the entrance is accompanied by a notification signal to the account. Therefore, it is possible to perform pre-programmed actions in case of a GPS sensor triggering in geofences.

Regarding SEO, the term “geofence” is understood as a tool for promoting goods and services on the Internet through the use of GPS, IP address, and various beacons configured for the user’s geographic identification (in most cases through a mobile device).

What is Geofence Marketing and how does it work?

What is geofence marketing, and what is its effect in practice?

First, let’s deal with the technical side of the issue. As noted above, the technical component of the issue of using a geofence from a marketing standpoint is rather the prerogative of SEO rather than purely satellite or other monitoring and control systems. Implementing the geofence in the company’s marketing approach will allow achieving such properties of the marketing strategy as adaptability, flexibility and focus on a particular consumer. Let’s take a closer look at each of these properties.

Thus, adaptability and flexibility based on geofencing marketing are achieved because the offer of goods or services can change and adapt to a specific situation in case of changes in the subject’s location. This provides comfort and convenience of access to information about the product in the exact place and at the time when it is most convenient for him.

Based on zonal smartphone tracking data, the marketer can specify locations and target specific efforts to the individual consumer. In this case, mobile applications and web pages, SMS distribution or push notifications can be used as channels. In addition, geofence marketing is often identified with geofence advertising since it is the geofence that is used to create personalised ads within its boundaries. The result is an advertising appeal received on the smartphone-target audience’s smartphone in a territorial connection with the object of advertising. It is enough for a user to connect to the network, and his IP address, mobile geolocation, or belonging to a Wi-Fi client will become known to a marketer interested in sales. Therefore, we often see local advertising on our devices, regardless of its type or the installed application.

Developing and implementing a successful geofence marketing campaign involves the implementation of a certain sequence of steps.

• Stage #1. Specify the geofence. The capabilities of a geofence allow you to set its boundaries either by the territorial affiliation of the object or based on a central point from it.
• Stage #2. Set restrictions on entering and exiting the geofencing system. The input conditions must be triggered if the subject approaches the territory we need. At the exit, the conditions relating to motivation and branding are relevant.
• Stage #3. Combine geofencing with targeting. Behavioural targeting in synthesis with geofence marketing is a powerful tool for combining the target audience’s interests and geofence advertising.
• Stage #4. Create and place an ad within the geofence. Again, bright visualisation and personalised advertising make the product offer attractive and specify the mechanism for acquiring it for potential customers.
• Stage #5. Run analytics and optimise your campaign. Include in the analysis process various metrics specific to geo-zone marketing. Then optimise your marketing campaign within the established geofences.

Features and Benefits of Geofence Marketing

Building geo-fenced marketing campaigns definitely has positive aspects.

Firstly, the mechanism of geo-zone marketing is aimed at the efficient use of geographic space by local companies in local markets since the entities present here are potentially attractive to the seller.

Secondly, marketing on the phone is convenient and accessible to almost every person who dynamically moves around the nearby territory during the day. Consequently, the advertising reach of the target audience is much greater than the use of static advertising on various media.

Thirdly, geofence marketing can become your market advantage over a slow and short-sighted competitor.

And finally, fourthly, geofencing marketing will allow us to collect information directly from the subjects themselves, which will help us build the right strategy. And from the classic marketing course, we remember that primary sources of information are the most reliable.

In addition, the main features of geofence marketing include:

• increasing brand awareness;
• increase in the involvement of the target audience in the sales funnel;
• facilitation of search engine optimisation when building an SEO strategy and an advertising strategy based on geofence;
• repeated presence in a particular geofence may indicate that the buyer is loyal and ready to make a repeat deal;
• instant targeted advertising in the geofence.

Where is Geofence Marketing Used Most Often?

Any use of a mobile device, use of Wi-Fi or an identified IP address may be subject to geofencing advertising. Therefore, applying the ideas of geo-zone marketing is appropriate and reasonable when it comes to a clear impact on a specific market segment geographically. If you think on a large scale, then by the nature of their activities, companies that implement geofence marketing are mainly related to the field of trade and services. However, a geofence is also appropriate for the sphere of culture and entertainment. In particular, geofence marketing can be recommended to such businesses and non-profit structures as:

• Service stations and car service;
• enterprises of restaurant and hotel business;
• cinemas, theatres, museums, parks and so on.;
• car dealerships;
• beauty industry organisations;
• fitness halls and other sports facilities;
• private medical business;
• local craft producers;
• local media and public organisations;
• private educational projects and companies;
• coworking spaces;
• clothing and footwear stores, showrooms;
• specialised stores (focused on selling jewellery, goods for children, animals, motorists, book lovers, etc.).
• other companies with an interest in a particular local market.

In addition, geo-fence marketing campaigns, in addition to the advertising component in the content, can be aimed at some types of control and are of interest to representatives of SaaS companies. Thus, geofence-based services can be provided to monitor and control the movement of official and private vehicles, track walks and arbitrary movements of pets, control employee mobility, monitor children, and so on.

Difference Between Geofencing, Geotargeting and Geolocation

Despite all the similarities in the tools and methods of geofence marketing, geotargeting and geolocation, specific differences are characteristic of each of them. In particular, geofencing and geotargeting are types of targeting based on location.

The geofence as a virtual territory on the map is focused on activating specific actions when crossing a conditional border, for example, push notifications. Geo-fenced marketing can lead to quick conversions and can churn customers away from a competitor in your favour. The geofence’s specifics are the growth of the target audience and binding to a more localised area, for example, a district.

Geo-targeting is essentially similar to geo-fencing but has a more specific application for the purpose. Geo-targeting sets more matching criteria. This narrows the target audience but contributes to brand awareness and conversion in the future.

In addition, a reasonable combination of geofencing and geotargeting is possible as part of a marketing campaign aimed at a specific location.

As for geolocation, this tool focuses less on the subject’s current location and more on finding out where he was before. Geolocation is useful when it comes to capturing a wider audience. If you have not decided on the target specifics or are unsure about the route of movement and the location of the target audience.

Geofence Marketing Examples

Let’s turn to the practice of a successful business to understand what geofence advertising and geofence marketing are, how it works, and what are its advantages.

• Amazon was one of the first to scale the possibility of using geofencing for business customers. The location service helps them identify subjects and integrate the geofence into their own programs. Embedding this function allows you to carry out geocoding, geofencing, tracking and route planning, and so on.
• Uber uses geofencing to provide services in places where there are organisational restrictions. For example, geofencing helps Uber send notifications to mobile app users about free taxis in their area, even if the airport or other facility has banned such cars from staying on its territory. All the client needs is to use a smartphone and get into a vehicle near the geofence.
• Starbucks is not only a leader in the service industry and a world-famous brand. It is also the pioneer of geofencing marketing. Push notifications from Starbucks about happy hours not only help to interest a person in the coffee shop area, make a profitable purchase and buy their favourite drink at half price, but also allow you to segment the target audience, find out its preferences, find out a convenient time and place for it.
• NextBee, as a marketing platform relying on geofences, offers the construction of campaigns in social networks based on the principle of geofencing and geotargeting. Such actions may be aimed at sending push notifications, other advertisements or rewards to registered members of the community. Once in the geofence, NextBee users can send out personalised offers, attract the right category of buyers, and participate in testing promising products and services in the designated geofence.

The benefits of geofencing marketing are undeniable, especially regarding the need for quick conversions and a short-term win over the competition. Also, one simple rule should not be forgotten – the smaller your geofences, the more likely it is that the client will remain a brand adherent, and your budget will not go anywhere. Use sales, discounts and other incentives. Attractiveness in the geofence is the lion’s share of success!

Checked by marketer Victoria Fedchenko