Geofencing Advice For Local Online Retail Businesses
In this era, online shopping has revolutionized how people shop, shifting away from traditional brick-and-mortar stores. With a few clicks, consumers can conveniently purchase goods and services from the comfort of their homes. For entrepreneurs in the retail sector, it’s essential to employ tools and strategies that elevate their brand and attract their desired customer base.
A particularly effective tactic in contemporary times is geofencing. But what is geofencing, and how does it work? Geofencing technology empowers businesses to target customers in specific areas by creating boundaries using GPS or RFID technology. Mastering geofencing enhances customer engagement, improves marketing efforts, and ultimately drives sales, offering a dynamic approach to connecting with your audience in the digital age.
Know Your Target Audience
Before diving into any marketing strategy, knowing your target audience is crucial. For geofencing, pinpointing where you want to engage customers requires understanding their demographics.
Start by looking at your customer base and finding trends in their locations. Are there areas where your sales are strong? Conduct market research to discover opportunities you can leverage through geofencing. Keep it simple and effective to ensure your marketing efforts hit the right spots. You can outsource after-hours support to a call center outsourcing organization, as they train agents to know their customers. These agents talk to customers every day and learn about them. They use this knowledge to create customer profiles, which help gather more data.
Having accurate profiles and using important data are key to making the most of big data. Combining call history from the call center, your company’s CRM, and websites helps understand customer experiences better. With this info, your company can gather even more data to focus on specific customer groups.
Establish Clear Objectives
Just like with any marketing strategy, it’s essential to set goals to gauge your success. Define what you want to accomplish through geofencing – whether it’s driving foot traffic to your brick-and-mortar store, increasing app downloads, or boosting engagement on your website.
By outlining measurable goals from the start, you can monitor your progress and tweak your approach as necessary. For instance, you could set a goal of increasing sales by 10% from customers who receive a notification within three months.
Customize Messages for Personal Touch
Geofencing opens up possibilities for marketing in online businesses. By using location data, you can design marketing campaigns that resonate with your specific audience.
Rather than sending messages to all individuals within a geofence area, tailor your content to match the unique interests and preferences of each group. Take into account elements like weather conditions, community events, or cultural nuances when crafting messages.
Timing Matters
The timing of your communications is crucial for the effectiveness of any marketing effort, including geofencing. Sending notifications or promotions at the right moment increases the likelihood that customers will interact with your brand.
If you own a restaurant and want to attract customers for lunch, consider sending out an offer just before they start planning their midday meal. By studying customer behavior patterns and pinpointing peak shopping times, you can plan your marketing messages strategically for the best results.
Provide Value Through Offers
To make your business stand out and catch the eye of customers within an area, it’s crucial to offer them something valuable in return for their interest. This could include discounts, limited-time deals, or personalized suggestions based on where they are.
Customers are more likely to respond when they see benefits in engaging with your business. Tailoring offers to suit their preferences can lead to increased conversions and lasting customer loyalty.
Enhance User Experience
A smooth user experience is essential for keeping people engaged with your brand. When incorporating geofencing features into your app or website design, ensure that it’s user-friendly and easy to navigate for new and returning visitors.
Avoid bombarding users with too much information or unnecessary visuals – focus on delivering relevant content without causing confusion. Create user designs that smoothly lead individuals to take action, such as completing a purchase or finding a nearby physical store.
Why Geofencing is Important for Local Retail Businesses
Location-based marketing, like geofencing, has made its way to attracting customers (online as well as offline) to a store. The marketing model has become prominent in today’s smartphone-enabled world. With geofencing, retailers can get actionable insights into their target customers’ behavior, changing needs, and what they are looking for while having reasonable means to approach them with a solution.
Additionally, geofencing marketing equips a business to pique the interest of an audience that is more likely to engage with the service or product offered. This eventually results in a higher return on ad spend.
Using location-based marketing, businesses can reach their potential customers within a pre-defined area and have a high chance of capturing their attention. Geofencing campaigns can be set up on tablets, mobile, and desktop devices regardless of the demographics, geographical location, or business category.
As geofencing ads are versatile, they can be used by a wide range of businesses as long as their target audience is well-defined. It also helps a company located in a crowded space to stand out and be able to attract its target audience.
7 Benefits of Geofencing Advertising for Local Businesses
It allows businesses to hyper-target their potential customers with timely and relevant offers.
It diversifies the data insights a business can collect from user behavior aspects like online activity, purchase interests, and web browsing patterns.
It allows a business to customize its offerings (discounts, promotions, and special offers) to match the target demographics.
As the ad campaigns are more relevant, practical, and real-time, they are more likely to attract purchases, maximizing your budget.
It gives a business a competitive advantage as it ensures they can drive traffic to them by using well-planned and rightly placed geofencing ads.
Increases brand awareness by putting your brand in front of an audience that is already in your pre-defined fence.
It allows marketers to create spatial boundaries within their ad sets to target a specific type of audience.
How You Should Use Geofencing in Your Marketing Strategy?
What is geofencing ? How it can be of great benefit to businesses regardless of their sizes. Here are some geofencing marketing strategies to help you create an impactful and result-driven campaign.
1. Ad Copy
Create an ad copy that resonates with your audience and encourages them to take action. This copy should be aimed at providing a solution in a simple, easy-to-understand language. Conducting market research is an excellent way to understand how your competitors are talking to their target audience. This will help you understand the gaps and come up with a better, more impactful campaign ad copy.
2. Finding Appropriate Location
Find locations where your ad campaigns will be able to capture qualified leads. Without choosing suitable locations, even the most carefully curated ad copies will have no effect. To achieve this, conduct thorough market surveys to identify places where your target audience spends most of their time. Apps like Snapchat, TikTok, LinkedIn, Facebook, X (formerly Twitter), and Instagram are some popular platforms where you can find your target audience.
3. Appropriate Sizing
Keep your fence compact, as an oversized fence can make it challenging for your potential customers to find your business once they have interacted with your ad. It can come across as misleading and might negatively impact your brand reputation. Furthermore, a small fence will smoothen your lead acquisition process. Maintaining the radius within a mile can do wonders in bringing engaged customers to your store (physical or online).
4. Call to Action Button
Add an action-oriented and compelling call to action button that tells your audience what they need to do once they engage with your ads. For instance, “Visit our store for a FREE quote” clearly tells your potential customers what they will receive after they have visited the store. Avoid using CTAs that do not clearly indicate what to expect.
5. Pause and Play
Avoid running your ad campaigns at all parts of the day (unless your business operates during these hours). It will quickly exhaust your budget, and you may not always get leads. Instead, understand when your target audience is active. Running your campaigns during these hours will ensure your strategy draws traffic and converts leads effectively.
How Much Does Geofencing Marketing Cost?
Geofencing marketing costs are dependent on how large your target area is and the number of impressions your marketing campaign attracts. Aside from these, here are the other factors that play a role in determining the costs involved with geofence marketing:
1. Geofence’s Size
The number of geofences you set up, and their sizes have an impact on the budget. Setting a larger geofence can lower your CPM as higher traffic volumes can reduce cost per impression costs. Additionally, as excessively large geofences can dilute your marketing effectiveness, prolonging the time taken to attract desired traffic.
2. Number of Geofences
While adding appropriately sized geofences will increase the effectiveness of your strategy, it is worth noting that they will also add to costs. Avoid planting geofences at locations that are far away from your business.
3. Data sets
Aside from location data, you could also be required to analyze other data layers, including behavior targeting and re-targeting for your target demography. You might have to pay for these additional data sets. It is a worthy investment as it will turn out to be helpful in the long run. These data sets will increase your understanding of your potential customers, and accordingly, you can customize your ad sets to become more relevant.
4. Extent of Reporting
Most geofencing tools will provide crisp details and insights about the effectiveness and impact of your marketing campaigns. If you are looking for a more in-depth analysis of the reporting, additional charges can be involved. Notably, these charges are worthwhile as they will help you understand your potential customers in-depth. The more detailed a report is, the better your chances of identifying opportunities and leveraging them.
How to Track Your Geofencing Marketing Campaign Effectiveness
Geofence marketing is highly specific in nature and can be customized to attract a potential customer in no time. However, not all efforts will pay off, making it crucial to have a strategic approach. Keeping room open to modify strategies and implementing them for better results could be the key to making geofencing work wonders for your business.
Here are some metrics to track to understand how your geofencing strategies are working:
1. Cost per Thousand
Cost per thousand or CPM is the measure of the amount of budget spent on getting a thousand impressions. It is a reasonably standard pricing model that is used to gauge if the campaign can drive results while covering the expenditures or if unnecessary expenses are involved. The geofencing marketing costs can be optimized based on your budget and response expectations.
2. Click-through Rate
It’s the ratio of how often your ads were shown and the frequency of people who engaged with them. A high click-through rate is a clear indication that your geofencing campaign is deriving desired results. On the other hand, a low click-through rate calls for revisiting the strategy and making changes to attract more traffic (and eventually conversions and ROI).
3. Cost per Click
This metric measures the number of clicks an advertisement receives. Cost per click indicates the extent of attention your advertisement campaign is getting. However, cost-per-click data might not be able to tell the quality of leads you are getting.
4. In-store Traffic
In the case of a physical store, measuring the frequency of traffic you are getting with your advertising campaign is an important indicator of campaign effectiveness. In-store traffic will help your business generate more sales and revenue.
5. Customer Experience Metrics
Every business aspires to offer value and an incredible in-store experience to its customers. In the case of geofencing ads, metrics like customer effort score (CES), retention or churn rates, customer satisfaction, referral rates, and customer lifetime value (CLV) are a few metrics to keep an eye on. These metrics are a clear indication that your target audience is happy with their experience and is willing to recommend your business to others.
Decide What Success Means for Your Geofencing Campaigns
Every local business is different, and so should be the criteria for determining if an advertising campaign has been successful. It is vital to establish what you are looking to achieve from a geofencing campaign, what the metrics should look like, and how these parameters align with your future growth strategy. Piecing together metrics and understanding the whole picture will help you establish realistic expectations while improving the results your campaigns drive.
End Note
Geofencing could prove to be an asset for local online businesses. By knowing your target audience, establishing objectives, personalizing messages, sending notifications at the right time, providing incentives, and enhancing user experience, you can tap into its potential and enhance your business. Keep in mind that technology advances. By staying informed and adjusting strategies when necessary, you can stay ahead of the game and effectively leverage geofencing for your benefit.
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