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New Advertiser Strategies for Geofencing

The Battle for Sales and In-Store Traffic is Moving to Smartphones and Tablets.Seattle geofencing

What’s the number one complaint in the malls and retail centers across the nation? “In-store sales are down! . . dreadfully down.” Thank you Amazon. This problem is worldwide.

Smart advertisers, however, are turning the issue into an opportunity by shifting tactics. They’re using “geo” strategies that target consumer smartphones to claw back sales. And, it’s working. In fact, the same tactics are working in markets that don’t have the same issues as brick and mortar stores.

 

Is this Greek to you? A short primer: Geofencing 101

  • Geofencing uses consumer smartphones and tablets and their installed apps to engage consumers based on their specific location and their behavior. As an advertiser, you deliver ads at specific times based on specific consumer locations.
  • Geomarketing is the general term for this type of location and behavioral-based tactic. Geotargeting is the idea that a consumer’s phone is ‘targeted’ based on where they are and what they do.
  • Behavioral Targeting means specific groups of people are targeted based on “what they do” within any geographic area. Are they getting a haircut? Banking? Shopping for cars? Watching a movie? With the right web data (and access to social media cues) the possibilities for identifying behaviors and meshing them with locations are endless.

The technologies that make this possible are GPS and RFID.

Why is this useful to advertisers, brands, and retailers?

Intelligence is the key. Like it, or not, big brother is here. We are being tracked (but not for nefarious reasons – unless you count consumerism as nefarious). And, many of the apps we install on our phones automatically opt us into geo-targeting by way of the dreaded EULA that no one ever reads.

In simple terms, the apps with the connected consumer can alert your customers to offers, special sales and more via digital ads in your apps or on your web browser. If you have the Starbucks app installed, you’ve seen this, but probably didn’t know you were being “geofenced”. However, don’t think for a second that those digital ads are random. Starbucks knows exactly how close you are to their locations, and they know something about your behaviors and mindset, as well. This kind of consumer-location-behavior technology is only going to get better as these systems evolve.

Geo-fenced ads within the mobile browser are also available. To the consumer, the ad appears just like any other ad online – it just happens to be relevant to their location.

 

Examples, please!

  1. A retail store creates a geofence around its physical location, and when shoppers pass through, they receive alerts that increase their likelihood of stopping and shopping or buying a service.
  2. An auto dealer uses targeting to see who’s leaving rival dealerships within a 100-mile radius of their lot. By showing them custom offers as they leave other premises, the dealer gives incentives to consider options and visit their lot.
  3. A concert and event promoter fences live events to aggregate and curate all the social media interactions generated by attendees at the event. This helps them understand what the fans are liking, and that information helps the promoter integrate brand experiences with social activity in real time. (Live Nation does this with something called ShowBook.)
  4. An advertiser with content that’s hyper-relevant to events and locations can deliver custom content at the right times, building brand and seeding future sales.
  5. A publisher delivers location-triggered content that brings consumers back to online publications after they’ve had certain experiences. (Elle Magazine did this with the Swirl, ShopAdvisor and RetailMeNot apps.)

The possibilities for geofencing in a popular mall location are endless. In this one local area, you have hotels, country clubs, high-end retail, big box stores, spas, gyms, churches, civic centers, museums and more!

The data and tactics are getting better every day. Even if a geofenced offer does not convert, the business doing the fencing gathers valuable data about exact locations related to that message. This helps them refine their targeting efforts and gives them feedback on ad performance. With modern ad placement systems, you can also optimize campaigns based on real-time performance. If one ad is out-pulling another, the more successful can be immediately deployed and the lesser-performing ad scrapped.

All kinds of businesses – from small-scale shops to Fortune 500 companies – can use geofencing to improve the consumer experience and increase in-store sales. There are so many options to explore. With a little creativity and imagination, totally new and intriguing scenarios will inevitably come to market. What does this mean for advertisers? You can be more targeted and strategic with your ad dollars than ever before. Better strategy, better advertising, and better results.

Stephen Reed is the CEO and founder of Vision Media. Based in Redmond, Washington and established in 2002, Vision Media specializes in local and national media buying, strategy and consulting.