How a business can target its audience specifically: a guide to increasing profits with geofencing
Advertising for goods and services has long grown beyond impersonal messages with template phrases. Today, personalization and relevant offers are appreciated, in which geofencing will help you perfectly.
Collect information about the user, analyze his movement and create the most relevant messages for your audience.
In this article, we will tell you what geofencing is and how it can help you increase your sales.
What is geofencing?
Geofencing is a feature that uses GPS, RFID, Wi-Fi, or cellular data to locate a user and trigger a predefined action when the device enters that area.
These can be very different actions, depending on how you set them up. There are many options for making you known to the client: push notifications, text messages, targeted advertising, or any other manifestation.
Geofencing can also be used as an analytical tool to track customer behavior and analyze data later. Geofencing in this case works in conjunction with DSP and gives a higher efficiency when working with advertising.
According to a BIA / Kelsey study, the geofencing advertising market is expected to grow to $ 38.7 billion by 2022.
The common use of geofencing technology
There are several basic geofencing business applications. Let's consider the main ones.
A striking example of the use of geofencing is events. You can use it to enhance your event experience. After posting a photo indicating the location or review, you can offer some bonuses.
Marketing and advertising
One of the common uses for geofencing is to set up a virtual fence around a competitor's location.
Personal location tracking
This is true for parental controls and smart homes. You can watch everything that happens while walking or at work. Another area of application is the medical field - various patient care centers.
There are two types of geofencing: active and passive. In the first case, everything depends on the user, whether he has geolocation enabled and/or whether he uses the application. Second, it all depends on cellular data via mobile devices or Internet connections over Wi-Fi, not RFID and GPS.
How does it help business?
Geofencing is often the final factor for making a purchase. Location-based campaigns drive app downloads and can help customers choose you. In addition to direct offers, you can offer bonuses and carry out promotions.
Product managers also report increased engagement when using geofencing, especially if your service is a necessity. For example, a taxi at the airport or train station. If we talk about offline locations, then geofencing in combination with the use of a native application will help to work with regular customers.
As for the restaurant business, in addition to attracting new customers, you can also provide a higher speed of customer service, both in courier delivery and self-pickup.
Stores can use geofencing to send promotions and special offers to customers who have just made a purchase. In addition, you will be able to collect analytics on customer behavior (time spent in the store, how it moves, and so on).
What resources do you need for its implementation?
To install geofencing on a mobile device, you need software integrated into the device. All control, in this case, will take place through the API. Before getting started with geofencing, it is important to identify the goals and needs that you are pursuing.
In total, there are several levels of interaction with geofencing:
- administrator (business owner);
- application with built-in geofencing definition;
- device user (customer or client).
To implement the geofencing function, you need a developer. It is he who will indicate in the code the geofence, the intersection of which will cause a reaction. Virtual ganitz must support GPS or RFID.
Geofencing is only relevant for native applications. Since the use of personal information requires compliance with all the requirements specified in the OS stores. Launching a push notification with a request to transfer geolocation.
The cost of connecting geofencing differs depending on what range of work you choose.
Let's consider the main factors affecting the cost of implementing a function.
- Self-service or full service. In the second case, the price will be higher. Self-service is appropriate for projects with complex targeting or premium placement.
- The size and number of geofences. The more zones, the higher the cost. You should also take into account the difference in the number of geofences for iOS and Android.
- Level of reporting. Some services show a breakdown of impressions by location, while others provide only general information about the campaign, or even collect a list of locations where the ad was shown.
- Targeting and its levels. Demographic and behavioral targeting, retargeting, and other features add value to your work.
How to create a proper geofencing strategy?
For geofencing to bring the expected result, it is important to competently approach the formation of messages and the choice of zones. Consider the key factors that will increase your chance of success.
1. Relevant text for your audience.
You must clearly understand your target audience, only then the text will look attractive to her. Use slang or local words that resonate and grab attention.
2.Correctly define the geofence
If your target audience is not where you are, you are missing out on an opportunity to attract leads.
This can be a shopping center or a specific quarter of the city.
3. Do not spray
You shouldn't make the geofence too big if you want to get real sales. Nobody will go to you on the other end of the city for a promotional pizza. The optimal geofence size is a four to five minutes walk/drive to your location.
4. Think over the CTA
The text should be simple, clear, honest and meaningful.
5. Determine the advertising time
Run ads when you are working and ready to serve your customers. The optimal advertising time is the day, except for night-type establishments (various clubs).
6. Optimize your campaign
Don't just collect data, but analyze it, try different hypotheses and improve everything where you have drawdowns.
Best ideas from world-known brands
Most global brands successfully use geofencing to improve service and increase sales.
Uber and bypass restrictions
Many airports are prohibited from offering taxi services without a license. Therefore, Uber has set up sending push notifications right at the boarding zone. This way they get customers as soon as they land and turn on their phones.
Burger King and the "fence" around competitors
The "Whopper Detour" campaign was launched with a setting around McDonald's. A 600-meter virtual wall around a competing fast-food announced the opportunity to buy Whopper burgers for 1 cent through the Burger King app.
BMW and perfect service
Thanks to the unusual use of geofencing, the company was able to provide a high level of service to all customers. The application read the location of a person and his car, therefore, for example, in the case of starting a car without a key, the user was notified.
There are some questions regarding consumer protection in the context of the use of geofencing. But geofencing is unlikely to be banned on a more global level, so you can safely plan its use in your promotion strategy. By next year, the geofencing market is expected to grow by 27%.
Geofencing is not just about tracking a user's position, but also collecting complete behavioral statistics of users. A connected geofencing app gives you a significant edge over the competition. Using this tool, you can get a loyal customer base and increase your conversion.