As digital marketers, we are always looking for the next best thing. Our clients are too! But just because something is the “next” thing doesn’t always mean it’s the “best” thing for your business. That’s why it’s important to be strategic about which types of digital marketing tactics and channels are used to grow your business.
For those who are new to the world of digital, it may be hard to navigate all the different types of digital marketing tactics, so we thought we’d start off with one that we’ve received quite a few questions about lately: Geofencing.
WHAT IS GEOFENCING?
Geofencing is a location-based service in which an app or other software uses GPS, RFID (radio-frequency identification), Wi-Fi or cellular data to trigger a pre-programmed action when a mobile device or RFID tag enters or exits a virtual boundary set up around a geographical location, known as a geofence.
HOW GEOFENCING WORKS
To make use of geofencing, an administrator or developer must first establish a virtual boundary around a specified location in GPS or RFID-enabled software. To do so, the “fence” must be specified using APIs (application programming interface) when developing the mobile app. This virtual geofence will then trigger a response when an authorized device enters or exits that area, as specified by the administrator or developer. A geofence is most commonly defined within the code of a mobile application, especially since users need to opt-in to location services for the geofence to work.
WHAT YOU NEED TO GEOFENCE
- An app/software
- A “Fence” built into the app/software
- Specified using APIs (application programming interface) when
- developing the mobile app
- Users of the app must opt-in to locations services
WHAT ARE COMMON USES OF GEOFENCING
- Collect location insights about user’s offline behaviors for audience segmentation, personalization, retargeting, competitive intelligence, and online-to-offline (O2O) attribution.
- Send location-relevant content to mobile users based on their current or recently-visited location, to drive their engagement with the app.
HOW IS GEOFENCING USED IN DIFFERENT INDUSTRIES?
- Geofencing can be used in many different ways. Here are some examples of how marketers in various industries already get creative with geofencing:
- Retail: Sending promotional messages as shoppers pass by a store to drive visits.
- Automotive: Retargeting users that have visited a car dealership (yours or competitor’s).
- Coupons: Proving the ROI of coupons using location data to track store visits initiated by coupons.
- Airline: Upselling flyers with fast-track services as they walk in the airport.
- Mobile payments: Reminding users of places where they can pay as they visit them.
- Hospitality: Capturing feedback shortly after visitors step out of the hotel.
- Travel: Enriching user profiles with traveling history to supercharge future targeting.
- Dining reviews: Suggesting a list of popular dishes to a guest who visits a particular restaurant.
- Coffee chain: Giving discounts to returning customers to build loyalty.
- Online store: Geo-conquesting competitor locations with deals to lure customers away.
IS GEOFENCING RIGHT FOR MY BUSINESS?
- As with everything, geofencing may not fit every company’s mobile marketing strategy. If a marketer can relate themselves to one of the examples below, it’s most likely a fit.
- My company has brick-and-mortar locations, such as retailers, food & beverage chains, airports, airlines.
- My company has a strong connection to brick-and-mortar locations, such navigation platforms, travel guides, online retailers with offline competitors.
EXAMPLES OF GEOFENCING
- Uber uses geofencing at LAX almost as a defensive measure. That’s because private hire cars from networks like Uber aren’t licensed to pick up passengers at this airport (apart from the app’s luxury service, which is commercially licensed and insured). Therefore, Uber uses a geofence outside of the pickup area, where drivers can wait for fares. When someone walks into Uber’s geofence, they will get a notification that says “Welcome to San Francisco. Would you like us to pick you up? There are currently three cars near the airport.”
- A retailer might draw a geofence around its outlets to trigger mobile alerts for customers who have downloaded the retailer’s mobile app. In these cases, a geofence that is managed by the retailer is programmed into the app, and users can opt to decline location access for the app. When a customer walks into the geofence, they will receive notifications informing them of certain promotions happening that day.
- Taco Bell’s app is a crucial tool in their geofencing marketing plan. Its mobile ordering feature entices users to download it. With the app in place, hungry customers can order from their phones and then simply go pick up their food – no wait. After customers have downloaded the app, the restaurant utilizes geofencing as a way of targeting people under 30 years old with push notifications whenever they are in the vicinity of a Taco Bell. A quick reminder that they can order food from their phone and pick it up two miles down the road was a great way to appeal to the “Want it Now” generation.
- Starbucks often uses geofencing to remind customers of new drinks and promotions. Anyone who has downloaded the app and opted-in the location services can be targeted through geofencing. The customer just has to walk into the geofenced area, and they will receive a notification from Starbucks on their phone enticing them to stop in for a coffee.