A main goal in marketing is to target the right segment of customers in the right place at the right time. Geolocation targeting makes this task much easier. What is geolocation targeting? It is personalized communication based on a customer’s whereabouts. Marketers can target by county, state, zip code or, on the most granular level, GPS. Every smartphone contains Global Positioning System (GPS) navigation capability, which navigation apps and marketers can collect and utilize. While IP addresses could track online users in the past, mobile phones have less accurate IP addresses usually correlating with the provider’s office, so marketers need to instead request access to a person’s GPS location.
Begs the question, are customers really willing to share their location with companies? In a word, yes! Studies show that 57% of customers are happy to share their location to get more relevant advertising and 53% of customers are more likely to engage with location-based advertising. Customers are more receptive and likely to respond to geolocation targeting. For example, 72% of consumers respond when they see calls to action that are in viewing distance of a retailer.
Just because you can target using proximity to create relevance doesn’t mean that you should. Good geolocation targeting requires the marketer define a range. However, smaller range doesn’t necessarily mean better marketing. There is a tradeoff between reach and specificity. If location is too narrow ,it will be difficult to have a large audience. If it’s too wide, then it may detract from the intended action.
Another best practice to remember is that mobile doesn’t mean on-the-go; people often check their phones at home or at work where they may not be intending to make a purchase. Location should inform the content of the campaign when it comes to season, weather and regional events. For example, a retailer may want to profile festival style clothing for Austin subscribers right before SXSW, or send coupons on coats during a particularly strong cold front.
Examples of Geolocation Done Well
A case study involving Outback Steakhouse showed that engagement and intent to buy was significantly higher with geotargeted ads. Post-click activity was highest on the geo-conquested portion of the campaign, with an 11% life on conversion actions such as access to a store locator. The Outback campaign used 5 and 10 mile geofences around various competitor restaurant locations seeking to catalyze visits from loyal customers and possibly change behavior of those considering different casual dining establishments. Outback measures success by comparing same-store sales before and after. Below is an example of a campaign ad:
Another example is a Taco Bell’s Happier Hour interactive campaign that combines engagement and convenience to produce tangible results. The campaign utilizes a phone’s reminders to set alerts and allows for downloads as well as proximity notifications when a consumer gets close to a Taco Bell location. Furthermore, there was an “Invite a Friend” bar that allows customers to choose a GIF to send to a friend as an invitation to join them for Happier Hour.
Source: Mobile Commerce Daily
The key to successful geolocation is establishing customer benefit. As long as marketers can provide incentives such as discounts, early passes or convenience, customers will be willing to share information as personal as their location. If marketers can provide value, and use data in a smart and reasonable way, geolocation is a very powerful tool.