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Technology is radically reshaping our world, and there is perhaps nowhere that is truer than in marketing. While we love to romanticize the creative process in shows like Mad Men, modern marketing relies as much on smart devices and algorithms as it does on psychology and natural talent. And if your business wants to remain relevant, now is the time to adopt these new approaches.
Of course, taking on too many new technologies at once can be overwhelming and result in an ineffective marketing campaign. If you are looking for a starting point, we suggest location-based marketing.
In a way, marketing has always been based on location. For example, a restaurant in Chicago would purchase radio ads on stations in the greater Chicago area—not Los Angeles. But that is not what location-based marketing was in 2018.
So, what is it? It is a broad term that refers to multiple digital marketing technologies allowing marketers to target mobile users who are physically present within a certain area. This area can be massive—perhaps an entire tri-state area—or as small as a single store. Through this technology, businesses can market to those individuals most likely to purchase from them based on physical proximity.
If you use online advertising, you might figure that you already use location-based marketing. Taking Facebook advertising as an example, when you create an advertisement on the platform, you are asked to define the geographic location of those you are marketing to. However, this isn’t a perfect science. Sometimes users will enter a different city than the one they live in or fail to change it when they move. Facebook may target those who only visited your city, but in reality, they live across the country. Location-based marketing uses the real-time or most recent location of the targeted audience, making it much more exact.
Location-based marketing is a broad term that includes multiple types of marketing technologies. While there are always new options on the market or in development, four key technologies are currently in play: geofencing, geotargeting, RFID, and beacon.
Geofencing in marketing is a technology that establishes virtual fences, sectioning off a specific geographic location. The company using the technology is given incredible control over the placement of the fence, with the ability to define the area on a block-by-block basis. As such, local businesses can use their knowledge of travel patterns, foot traffic, and more to get the most out of their use of geofencing.
With geofencing, marketers can target people who enter the fence, exit the fence, or restrict it to those who spend a certain amount of time within the fence, showing them ads as they browse the web or use ad-enabled apps, often through Google Adwords. This technology does not rely on the last known location of the user. Instead, it is based on their real-time location, using either GPS or IP address to determine the location of the individual.
Geotargeting in marketing can be thought of as a more exact type of geofencing. With geofencing, ads target users strictly based on their relation to the virtual fence. Geotargeting goes beyond location and takes demographics, behaviors, interests, and more into consideration. Because it is pickier about who is being targeted, it is often suggested that the fence be made bigger for geotargeting.
As it is more exact, smaller businesses without a marketing department may struggle to use it effectively. The more you know about the customers you want to target, the easier it will be to implement geotargeting. As such, it is best to work with an advertising agency when using geotargeting technology.
Beacon marketing technology has perhaps the smallest reach on this list. With this form of marketing, you place small, low-energy devices in your store that use Bluetooth technology—the beacons. These beacons detect the presence of a smart device and then trigger push notifications to the devices they see. This technology is cost-effective and easy to use, but it does rely heavily on proximity, and devices can only be detected if their Bluetooth function is on. Additionally, the push notifications are generally app-dependent, so the user must have a specific app downloaded.
However, its precision is noteworthy. It may not encourage those outside the store to enter it, but it can encourage those already inside to make a purchase. For example, you could have a beacon near a key display, and as shoppers come close, it could inform them of a special discount. Out of all the location-based technologies, this is likely the easiest for most small businesses to implement on their own.
Location-based marketing is thought of as something of an equalizer between small businesses and massive conglomerates. While larger companies have long had the ability to reach their audiences through massive and nuanced campaigns, smaller companies have been left behind. Through location-based digital marketing services, small businesses stand on equal footing and might even have an advantage over their larger competitors depending on where they are located. As such
, while any business with a physical location can benefit from these technologies, small and mid-sized businesses have the most to gain.
Just because a technology has been proven effective does not mean it is right for your business. Before deciding to utilize location-based marketing, you need to weigh the benefits against the risks. To help, we will outline the pros and cons of location-based marketing below.
As with any marketing strategy, it is possible to get location-based marketing very, very wrong. When implementing it, you should take care to stick to best practices. But what are these? Let’s take a look at a few.
So, is location-based marketing something your business should consider? If you are interested in finding out, schedule a consultation with StratGrow, a Tucson digital marketing company. Our strategic marketing experts will be able to determine if location-based marketing would benefit your business, as well as craft a comprehensive marketing plan incorporating it. Allow us to be your Tucson advertising agency.
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