In the search for new technologies that can improve business performance and customer awareness, every new tool at your disposal can be a crucial advantage against your competitors who have yet to adopt it.
The ability to identify potential and current customers who live close to your retail location with custom-tailored promotional content is one such asset; targeting them with calls to action after they consume that content is another. Combining both is a profound method for gaining and retaining customers.
The tactic and tech you use for that combined effect is called geofencing, and it is a new frontier in intelligent advertising and customer interaction.
Geofencing allows you to target goods and services to people located near your business with hyper-specific queries. It also opens new avenues for local stores and businesses to set up multilevel campaigns to improve engagement between them and their potential customers. You can then collect data about those customers—such as demographics, time spent in-store, and other details—to exponentially improve your targeting and business operations.
Most mobile phones are able to support geofencing technology, which is handy when more than 50% of consumers spend more than five hours a day on their smartphones. Now, consider that 80% of consumers use their smartphones while present in a physical retail location, and that smartphones account for over 60% of all retail website visits.
If you take all of those factors into account, you begin to understand the remarkable potential of geofencing, especially when it targets smartphones and smart devices.
The Technology Behind Geofencing
Geofencing works by enabling advertisers to deliver audio, in-app, CTV, and Web ads upon prompting via radio frequency identification (RFID), Wi-Fi, GPS, or cellular data. Most of those technologies are familiar to most people, but RFID is perhaps less so: It works by using electromagnetic fields to automatically identify and track tags attached to specific objects.
When a tag is triggered by an electromagnetic pulse from a device, it transmits digitized data back to the reader. RFIDs are commonly used as an alternative to barcodes because the reader does not have to be within sight of its intended target to pick up useful information.
Geofencing is based on a simple concept: When people enter a location, an action is triggered on their smart device. Their phone then picks up data sent via the aforementioned frequency technologies, and subsequently, theyconsume your ad content in real-time.
That predetermined location point is referred to as a geofence, and it can be targeted in many ways, starting with the hyper-local ZIP code level that offers a granular level of precision that allows advertisers to reach clearly defined segments.
It then builds up into towns and cities, which is perfect for small and midsize businesses looking to expand their brands, and then to the state and regional level for companies that want to continue their growth and reach larger new markets. There are also designated market areas (DMAs) to consider, which are zones defined by television markets, helpful when taking into consideration broadcast media and its distribution within specific local markets.
The key takeaway here is simple: Geofencing can have variable and adaptable applicability and it can be tailored to your company's needs.
Geofencing also allows retailers to gain insight into their consumers' behavior, as well as the real-world locations where they are most likely to participate in certain activities—which then can be exploited commercially.
Data accumulated by geofencing technology lets retailers apply greater attention to the customers who are most likely to actually purchase their goods or services, marketing campaigns powered by geofencing tend to yield a higher return on ad spend than the alternatives. That, in turn, allows commercial entities to create highly customized ad content for a truly unique experience for each customer, something that multiple studies have shown is popular (71% of the public prefer personalized content) and is also highly effective at generating both sales and increased brand loyalty.
Geofencing: Now to Build Your Audience
You need to watch out for various factors when using geofencing technology. For example, the location you target must have a high level of foot traffic or popup stores; otherwise, you won't be able to gather enough useful data.
If your retail property is located in a large multiuse complex, for example in an office building or along with apartments and condominiums, geofencing can find it difficult to differentiate between the shoppers, residents, and employees who visit the same building. However, with proper planning and the right expertise, avoiding those potential issues is easy and doesn't detract from geofencing's overall utility.
One of the best ways to avoid those issues is to adopt a cross-platform approach, because that targets the largest possible audience still united by niche interests. Specifically, use mobile geofencing, as it ensures that users have a good idea of whether their intended customer has visited their geo-marked location. When operated in combination with multiple platforms, you'll be able to give your customers the right content—not only on their phones but also via smart TVs, podcasts, and so on.
That ensures that businesses can make the most of their marketing budgets and that advertisers have the power to directly connect customers with said businesses whenever they're near one another. With the drastic cut in foot traffic many companies experienced as a consequence of COVID, any extra help in drumming up consumer interest is welcomed, and geofencing can help achieve that.
GeoNow by BidMind has enjoyed remarkable growth since it launched, growing tenfold in just 12 months. It's all part of our work to provide advertisers with top-level, niche audiences across all digital environments while ensuring a fully brand-safe experience.
