Introduction: Why Marketing Needed a Real-Time Upgrade
Everything we currently think of as digital advertising traditionally arose from the belief. Marketers assumed that simply placing an advertisement with common interests, keywords, demographic information and browsing history on a website or social network would eventually reach the right potential customers (which worked to some extent). Geofencing technology addresses the flaws of many traditional advertising methods and exploits an important factor in purchasing behavior that was, unfortunately, often overlooked.
In many cases today, location is perhaps the strongest indicator of when a consumer wants to purchase or obtain something; in this case, for instance, the likelihood that a person who is currently outside a restaurant wants to order and buy from said restaurant is significantly greater than that of someone browsing food options from home.
Likewise, in relation to the second example, a consumer walking through a shopping center is vastly more receptive to offers, deals, or discounts than when simply scrolling on a random device from one’s sofa. It was thanks to the services offered by geo agencies that several highly efficient digital advertising techniques emerged in digital marketing and were later adapted to mobile advertising, the most significant of which would soon follow in the form of the powerful and far-reaching technology we call geo-fencing.
What is Geo-Fencing?
It’s a GPS-enabled virtual “fence” around a real-world area defined by location data from GPS, Wi-Fi, cell towers and more. As soon as a person enters, leaves, or remains within a certain area, their mobile phone will trigger a programmed marketing response, such as push notifications, mobile ads, text messages, app updates, or social media targeting. Geo-fencing helps businesses connect with people in the vicinity.
How Geo-Fencing Actually Works
Essentially, geo-fencing creates a virtual (though you could define a zone in the physical sense using physical attributes) “fence” around your physical space, using virtual location boundaries determined by mobile phone GPS, Wi-Fi, cellular tower data and more. When a mobile device enters, exits, or lingers in a designated area, the device’s phone responds by initiating targeted marketing actions, including text messages, mobile ads, in-app messages, push notifications, or social targeting.
Role of a Geo Agency in Geo-Fencing
A geo agency will run and manage geo-fencing campaigns, using its expertise and Experience to achieve the desired results. Their work includes:
1. Defining Locations: The agency will work with its clients to define specific geographic zones where messages will be sent to relevant audiences; these include: areas with competing stores, busy city center areas, public parks with high traffic and areas where mobile users pass by frequently.
2. Content Creation Based on Context: To maximize the relevance of your adverts and encourage more click-throughs, geo agencies create unique messaging to accompany your ad campaigns, such as “Welcome back to X – Show this at reception for a special treat!”
3. Targeted Demographics: A geo agency can target a specific audience by age, gender and interests. So you won’t be paying to advertise to users who are likely to be inattentive to your product; rather, you will be targeting a precise niche audience.
4. Performance Analysis: It will also track your campaign’s performance, monitoring data in real time to make necessary improvements.
These can include adjusting your ad timing, widening or narrowing your geofence radius, or altering the strength of your offers or audience targeting.
Types of Geo-Fencing Strategies Used by Geo Agencies
There’s not a single way geo agencies use geo-fencing; rather, multiple cutting-edge techniques. Here are a few:
- Competitor Geo-fencing: This is a very offensive technique wherein a business places a Geo-fence around its competitor’s premises. Example: A pizza store sets a Geofence around another pizza shop.
- Event-Based Geofencing: Geo agencies focus their campaigns on large events such as concerts, exhibitions, sports matches and festivals. Example: The beverage company creates geofencing for users attending a cricket match. Users visiting the match receive: Product advertisements, nearby store location directions, LIMITED TIME OFFER
- Store Radius Geofencing: This is a classic but incredibly effective use case of geofencing: A geofence is placed around your store or business in either: 500 meters, 1 kilometer, 5 kilometers. Any user crossing this radius gets a ” You’re close to us type message, offer reminders, directions to your store
- Dwell-Time Geofencing: Geo agencies define this Geofence to target a user based on the duration spent by the user in a defined geographical location.
Example: If the user spends 10 minutes in the mall, he receives promotional ads because that may indicate he intends to make a purchase.
Why Geo-Fencing is So Powerful
Geo-fencing makes the connection because it utilizes all three factors in harmony: Intent + location + timing. Traditional mobile ads attempt to “assume” what the user is looking for. Geo-fencing makes a more informed assumption by targeting the user’s location, proximity and likely behavior, resulting in highly effective marketing conversions.
Benefits of Geo-Fencing Marketing
- They will be shown your advertisement as soon as you’re closest to your shop/place of purchase.
- Since people will see the advertisement when the need to purchase is present, conversion is greatly higher than most alternative ads.
- Nobody else sees these advertisements except the people closest to you.
- You’ll be targeting potential customers of your competitors, so you’ll take most of their business away from them.
- People appreciate it when they receive something helpful at the right place and right time.
Geo-Fencing in Mobile Marketing Ecosystem
Geo-fencing is most powerful when combined with mobile marketing.
Geo agencies integrate it with:
- Mobile apps
- SMS marketing
- Social media ads
- Google Display Network
Example:
A user enters a gym area and receives:
- Protein supplement ad
- Nearby health store offer
- App download incentive
Challenges in Geo-Fencing Marketing
Limitations of geo-fencing
- Invasion of Privacy: Geo-fencing technology can be seen as an invasion of privacy. Users might feel as though they are being tracked by geo-fencing.
- Reliance on Mobile Battery & Device: If your target users need location services to perform the geo-fencing for your campaigns to work, your geo campaigns will significantly drain battery on users’ mobile devices.
- Inaccuracy: Geo-fencing technology isn’t perfectly precise; location signals are unreliable on occasion.
- The Marketing of Over-Marketing: While geo-fencing can provide targeted notifications, if overused, it can also lead to mobile messages from your campaigns annoying potential customers
Future of Geo-Fencing Technology
As geo-fencing technologies progress. Here are future applications of geo-fencing:
- A.I. powered predictive geo-fencing: The technology predicts where the users will head to next.
2. Smart city integration: Businesses will tie into traffic management systems, public transportation, smart kiosks, smart billboards, etc.
3. Behavioral geo-fencing: Targeting users based on behavior and location instead of solely location.
4. Wearable device targeting: Marketing messages and ad campaigns to trigger as users walk into specific areas wearing smartwatches or AR headsets.
Conclusion
Geo-fencing marks a revolutionary shift in digital marketing – from broadcast to engagement and from passiveness to activity. And so Geo-fencing by an agency with geo capabilities enables marketers to intercept customers when they are closest to becoming customers. This means more effective marketing: Smarter, Faster, more timely and much, much more profitable. In the coming years, geo-fencing is expected to be ubiquitous in almost every digital marketing plan, combining our movement and communications data to bring businesses and consumers together instantly.