Mobile is the driving medium of today’s marketing landscape. Consumers from Millennials to Baby Boomers spend more and more time on mobile devices — you’re probably reading this post on your phone or tablet right now.
The prevalence of smartphones across the world and explosion of their usage offer many opportunities for avid marketers to promote their brands and products virtually anytime anywhere. That’s why many companies have attempted to keep up with their consumers by developing killer apps, especially since this is where 85% of mobile time is spent.
But here’s the catch. It has become so easy to reach buyers with all kinds of promotions that most marketing efforts get quickly forgotten or are never even noticed. Most mobile apps fail to make a lasting impression. Abandonment rates are extremely high — estimated at 60% and 96% after one month and one year respectively. And for better or worse, consumers spend most of their time using only 5 applications, meaning that a few winners reap almost all the rewards.
So how can marketers make their mobile app stand out and create a more engaging relationship with their consumers? This post discusses why location-based marketing — specifically geofencing — is a suitable alternative and presents different strategies to achieve that goal.
Location-based marketing and geofencing yield good results
Location-based marketing is more widespread than you may think. According to Statista, the number of mobile users accessing location-based services is 220 million in the U.S. alone — representing circa 68% of the country’s population and rising. Also, nearly half of marketers are already using location-based ad targeting.
Source: Statista (2017)
This category of services is growing in popularity because consumers are craving relevance and are more likely to respond to marketing tied to a place relevant to them — either the one they are at right now or the one they regularly visit. For instance, location-based campaigns have notification click-through rates that can be as high as 4.1% and 13.6% for IOS and Android users. That’s 10 to 100 times greater than generic push notifications and mobile banners.
Of course, careful thinking about brand messaging and communications remains sine qua non. But the ability to take advantage of specific contexts — timing and users’ whereabouts — has the potential to boost return on marketing investment significantly.
So how can marketers benefit from geofencing concretely?
Let’s look at what geofencing is in a nutshell. It’s a technology that captures location-based information about mobile app users and enables businesses to act accordingly in real time. For this to work, geofences — virtual perimeters within which data is gathered — are linked to physical locations such as a shop or a restaurant. Geofences can cover areas of varying size from a small building to a neighborhood or an entire city, benefiting marketers in four main ways.
Trigger contextualized notifications
Instead of flooding consumers with generic ads and offers, geofencing allows marketers to communicate with them when it’s more relevant as they enter, stay, or leave a business location. For example, brands can:
- Provide relevant information: A marketer could notify app users currently located in a commercial district and invite them to an exclusive event.
- Upsell customers: An airline could send a contextualized deal promoting “skip-the-queue” services right when a traveler enters the airport.
- Capture feedback in real time:A booking or hotel app could send their guests a notification asking to rate their stay just as they leave the hotel, instead of waiting two days to do so when it’s no longer relevant.
- Geo-conquest competitors: A home tools & supplies company could use its app to send notifications to customers when they enter competitors’ locations.
Build comprehensive user profiles
Location-based data generated within geofences can add a lot of substance to user profiles and uncover customers’ offline habits and insights to deliver enhanced personalization. For example, a transportation company can review how commuters travel throughout its network and make suggestions on how to improve their experience:
- Departing 20 minutes earlier to make it more likely to find a free seat
- Going through an alternative route to avoid unexpected traffic
- Buying a monthly subscription instead of daily tickets to save money and time
Retarget customers based on store visits
Geofencing also helps businesses to connect their mobile apps to brick-and-mortar environments and reach out to customers based on their visiting behaviors. For instance:
- Someone who has been in a store on two or three occasions in the past week could receive a notification to sign up to a loyalty program on the fourth visit.
- Consumers who haven’t come for a while could get a notification summarizing what has changed — new collections, product lines, sections — since the last time they entered.
- E-commerce websites could automatically retarget and send better deals to app users visiting physical stores.
Leverage location-based business intelligence
Imagine that you’re planning your next marketing campaign and want to know what exactly attracts shoppers and what doesn’t. With location-based intelligence, marketers know whether consumers went to a business location after they received notifications and other in-app promotions by measuring and attributing foot traffic. This information is useful to assess mobile app efforts and answer critical questions like the following ones:
- Which location-based notifications work best in different areas?
- How far are consumers willing to travel after receiving a notification?
- When should users be contacted after they entered, stayed for a while, or left a geofence?
- How often should notifications be sent?
- How do different segments respond to different notifications?
Hopefully this post has given you a better perspective about geofencing and how you can leverage it as part of your mobile marketing efforts to become increasingly relevant to your customers and drive engagement. Don’t hesitate to reach out if you have any question.
About the Author: Maria Golovanova is a marketing communications manager at Plot Projects. Plot Projects helps digital marketing professionals to easily integrate location-based marketing, such as geofencing, in their apps.