Have you ever walked out of a local business and been prompted on your smartphone almost immediately by Google to write a review? If so, you were targeted using geofencing technology.
While there are many ways to employ location based mobile advertising tactics, the practice of geofencing advertising is one that has grown significantly in recent years.
It’s no surprise, really. Approximately 81% of Americans own smart phones, and more than 65% of them check their phones at least 160 times each day. That’s an incredible opportunity for any business.
If you haven’t already added some form of mobile advertising into your marketing strategy, you could be missing out.
Geofencing makes it easy. By running a geofencing ad campaign, you’re able to tap your audience’s mobile location information to pinpoint exactly where they are and serve them targeted mobile ads and messages.
Eliminate oodles of media waste? Yes please! Catch your audience when they are most likely to be in a position to act? Heck yeah, tell me more.
How Does Geofencing Work?
Geofencing works by using special geofencing software to translate a defined geographic area, such as a building, art festival, hospital or mall, into GPS coordinates. The software then sets a virtual barrier around the area you’ve defined. When a trackable device enters the barrier, the geofence software senses this and permits a response action, such as serving up an ad to the device or registering the date and time.
Geofencing is not a new concept. Many industries have been tapping location-based GPS technology for a variety of use cases, including logistics, human resources and security. For example, many companies now automate time cards and payroll using geofence technology. When an employee enters the geofence for their employer, they are automatically clocked in, and vice versa when they leave at the end of their shift.
What exactly is Geofencing Marketing?
Geofence marketing uses these virtual barriers to deliver location-based marketing messages to the right audience at the right time. Depending on a campaign’s goals, geofencing marketing may encompass a variety of messaging tactics, such as text messages, app-based notifications, social media and display advertising.
Until recently, the requirements for geofencing marketing campaigns were relatively cumbersome to deploy. However, as more advertising providers begin to combine geofencing technology together with message delivery platforms, this super-smart marketing strategy is beginning to trend up.
Perhaps one of the easiest ways to get started on a geofencing marketing strategy is to start with geofencing display advertising.
Geofencing Advertising Examples
So how can you leverage geofencing advertising for your brand or business?
Just like any new marketing strategy, it starts with knowing your audience. Consider these ideas for building your geofencing advertising campaign:
- Proximity Targeting – Businesses with brick-and-mortar storefronts or offices where customers go in person to shop or receive services might set a geofence for the shopping center they are in to drive foot traffic from people who are already in the immediate vicinity. Offering an incentive – such as a one-day 10% discount – can increase their interest and entice them to check out your business.
- Competitor Targeting – This is a perfect use case for a shopping audience, whether its ladies’ fashion, car dealers or new home developers. If your audience is looking for a specific type of merchandise or a great deal, they are likely to visit more than one location. By geofencing your competitors, you can serve their consumers with geofence ads letting them know how your products or services may suit them better.
- Lifestyle Targeting — Understanding your audience is key to deploying this geofencing strategy. In this scenario, you would look for types of locations where your audience is likely to frequent. For example, a management training recruiter might target colleges. Or a plastic surgeon might target a combination of nearby gyms and beauty supply stores.
- Needs-Based Targeting – Some businesses must be more creative (or opportunistic) with how to take advantage of location based mobile advertising. For example, a personal injury attorney might set geofences around emergency rooms at area hospitals. Or a restaurant trying to increase its lunch crowd might geofence nearby office buildings.
What does it cost to start a Geofencing Advertising Campaign?
Getting started with a geofence advertising campaign is surprisingly affordable. Geofencing advertising is typically deployed and sold just like a digital display campaign, typically using a cost per thousand (CPM) or cost per action (CPA) model. Exact CPM will depend on your audience, location, size and number of geofences.
At Dragon Horse Agency, our basic package includes up to 20 geofences with a $3,000 minimum. Larger budgets can take advantage of more geofences.
This pricing makes geofencing ads extremely competitive with broad based display advertising.
Geotargeting vs. Geofencing
You may be wondering: What’s the difference between geotargeting and geofencing?
Many advertising platforms offer geotargeting capabilities, including Google Ads and Facebook Ads. This functionality is designed so you can offer different types of messages to different audiences. For example, if you have multiple locations throughout Florida, you may want build familiarity using images featuring each storefront. To do so, you could segment a geotarget for each location using a 25 mile radius around each address.
Some of these platforms allow you to target very tightly, with both Google and Facebook permitting geotargeting as small as a one-mile radius. Technically, these boundaries are using similar location based, GPS or IP address technologies. But if you have a well-defined audience, these larger geographic perimeters contain a great deal of waste, with a large percentage of ads hitting consumers who are not in need of your products or services.
Why use a shotgun, when you can aim smartly with a rifle?
Important Considerations for Geofencing Advertising
As you start to think about your options for launching a new geofencing advertising campaign, consider these tips to maximize impact and value to your business:
1. Know your audience before you start a location based mobile ad campaign.
Make sure you understand how your audience shops for your product, and how their lifestyle impacts their whereabouts. Geofencing advertising is all about location, so you have to be able to anticipate where they might travel throughout an average day.
2. Don’t set your geofences too large or too small.
The smaller the geofence, the less traffic will likely pass through it. This can make your CPM more expensive and it may take longer for your campaign to hit impression goals. Larger fences can make it easier to find your audience, and therefore could help keep CPM lower. But you may also end up with wasted impressions that miss your intended audience, or the possibility of spreading your budget too thin to have an impact.
Having said that, there’s no such thing as a perfect size geofence. Each campaign will have its own goals. A downtown proximity campaign might determine a 4-5 minute walk is optimum, or a competitive campaign might focus tightly on the perimeter of the target business.
3. Offer a clear call to action and an incentive when someone sees your geofence ads.
Catching people in the right place at the right time is only half the battle. Ultimately, the goals is to get them to stop by your store or office right away or at least make contact with you while they are in the right frame of mind. You should seriously consider offering a discount or other compelling incentive for same-day action, whether you’re seeking foot traffic, a phone call or a form submission on your website.
4. Measure and optimize your geofencing campaigns.
Key performance indicators for mobile geofence campaigns are similar to display campaigns, and include impressions, clicks, click-through rate, and qualified foot traffic. Secondary metrics might include time of day and date. These can all be used to adjust and improve your geofence campaign performance.
Turn to Dragon Horse Agency for Your Geofencing Advertising Needs
A geofencing advertising campaign can add a dose of energy and excitement to an existing marketing strategy, but it can also be an affordable cornerstone tactic for a new or emerging business ready to break out. The opportune timing of serving a competitive message right when your audience is in that frame of mind cannot be overstated.
Dragon Horse Agency can expertly guide you through the geofence advertising process and manage your campaigns from content to execution. We’ll help you scope out smart geofence locations, and ensure your campaign creative and messaging is spot on for maximum results. We’ll also provide you with thorough reporting and analysis.
Let’s take your marketing to a new level with geofencing. Contact us today at (239) 325-5088 for more information.