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The Power of Geofencing: Boost Local Sales with Mobile Advertising Strategies

The Power of Geofencing: Boost Local Sales with Mobile Advertising Strategies

In today’s mobile-first world, geofencing is emerging as a vital and powerful location-based marketing technique. This allows businesses to connect with customers and drive in-store sales. According to recent surveys, over 70% of customers expect personalized location-based services from local businesses. With over 5 billion smartphone users worldwide, location-based services are a must-have for brands looking to engage mobile audiences. These services influence their buying behavior through contextual, real-time communication. 

What is Geofencing?

Geofencing is a location-based marketing tactic that enables businesses to send push notifications, SMS, and other media to customers within a defined geographic area. This area is known as a geo-fence. This virtual boundary can be as small as a few hundred square feet around a store. Alternatively, it can be as large as a 5-mile radius around multiple locations. 

Once a geo-fence is set up, businesses can track mobile devices entering the area. Subsequently, they can send targeted ads, location-specific offers, and promotions to drive in-store traffic, sales, and repeat purchases. The location-aware capabilities of geofencing allow for contextually relevant communications based on a user’s proximity to a business.

Benefits of Geofencing for Local Businesses

Several unique advantages make geofencing an unrivaled proximity marketing strategy for local enterprises:

The Power of Geofencing: Boost Local Sales with Mobile Advertising Strategies
  • Highly targeted reach: Geofencing provides accurate targeting as ads are only sent to users within specified locations. This prevents wasted ad spending on irrelevant audiences.
  • Contextual marketing: Businesses can customize campaigns for audiences entering/exiting a geo-fence. This context maximizes relevancy and conversions.
  • Measurable ROI: The impact of geofencing campaigns can be tracked through store visits, online/offline conversions, and engagement metrics.
  • Omni-channel engagement: Geofencing enables integration with various channels like social media, SMS, push notifications, display ads, and mobile websites.
  • Real-time communication: Brands can connect with nearby customers and react instantly to increase foot traffic based on real-time location data.

Strategies to Boost Local Sales with Geofencing

Here are some proven and effective strategies for local businesses to drive sales using geofencing:

  • Welcome Campaigns: Welcome new visitors to a store by offering a freebie or percentage discount that is redeemable on their first purchase. This incentivizes walk-ins and helps acquire new customers.
  • Abandoned Cart Reminders: Remind users who added items to the cart but did not complete the purchase with personalized promotions when they are near the store again. This nudges them to convert.
  • Flash Sales: Run time-limited flash sales that are exclusive to customers within a geo-fence. The fear of missing out will create a sense of urgency.
  • Loyalty Programs: Offer loyalty rewards, bonus points, or members-only coupons to app users when they visit the store. This builds engagement and retention.
  • Drive Store Visits: Advertise in-store events, new product launches, and promotions to augment walk-ins from nearby users.
  • Conquesting Campaigns: Target consumers near a competitor’s store with better offers to divert them to your location instead.
  • Re-engagement Campaigns: Win back lapsed customers by sending personalized incentives when they are in the vicinity of the store.
  • Click-and-Collect Promotions: Encourage buy online, pick up in-store behavior with special discounts for customers who collect purchases from the local outlet.
  • Cross-sell Opportunities: Suggest complementary products or upgrades to users making a purchase in your store based on their past buying behavior.
  • Surveys and Feedback: Seek quick feedback from customers who just transacted at the store through brief surveys delivered via geofencing.

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How Geofencing Stacks Up Against Other Local Advertising Options

Geofencing has distinctive advantages over other location-based advertising channels like billboards, radio, and local TV:

  • Higher precision: Geofencing allows accurate targeting within a few hundred feet whereas other media blast ads across a metro.
  • Personalization: Geofencing enables sending customized offers based on an individual’s preferences and past purchases. Other channels only permit generic ads.
  • Real-time engagement: Geofencing facilitates instant connections with nearby customers, which is impossible through channels like static billboards.
  • Measurability: The performance of geofencing campaigns can be tracked, unlike traditional channels where metrics are ambiguous.
  • Cost efficiency: Geofencing provides high ROI at lower costs compared to expensive TV, radio, and outdoor advertising.
  • Omni-channel capabilities: Geofencing can integrate with a brand’s overall mobile, social media, and in-store strategy for amplified results across channels.

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Ethical Considerations and Best Practices

While geofencing is a powerful tool, businesses must navigate it ethically to respect consumer privacy. Transparency about data collection, securing explicit opt-in from users, and providing easy opt-out options are essential practices to maintain trust and comply with privacy regulations.

Bottom line!

As location-based advertising grows more sophisticated, geofencing is the go-to tactic for local enterprises to drive foot traffic, increase in-store conversions, cement customer loyalty, and boost their bottom line. The power to engage customers in real-time based on their location simply cannot be matched by any other media. For local store owners, geofencing should be a core component of their overall digital marketing strategy.

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