Geofencing is one of the buzzwords of digital marketing terms. While you may know the basics, you might still be trying to unlock what geofencing is. In this post, we’ll tell you everything you need to know about it so you can explain it to your advertisers and impart its value.

 

geofencingWhat Is Geofencing?

Geofencing is a location-based advertising tactic that targets an audience by geography. An app or software program uses some means to determine a location, including radio frequency identification (RFID), Wi-Fi, GPS or cellular data. When a device enters this virtual geographic boundary, a user may get served an ad.

An example would be that a person walking near a retailer then uses her mobile device to visit a website, and a digital display ad for that store pops up. However, a user must enable location services to receive this, so it is an opt-in type of digital advertising.

You can use geofencing with display ads, mobile messaging, in-app notifications and social media ads.

 

Geofencing vs. Geotargeting

Although they may seem the same, they are different. Geotargeting refers to desktop location-based advertising. Geofencing pertains to a virtual perimeter, so when any device is in this area, it could display a targeted ad.

 

Geofence Configurations

There are several options in configuring the virtual perimeter. The most common is around a specific place — a shopping center, entertainment venue, airport, etc. Other configurations could be around any brand location, a city or a state.

Does Geofencing Work?

Your advertisers may find this ad tactic appealing, and they’ll want some insights so they can understand how to use it. Presenting them with some of your previous campaign data would be ideal. You can also use these statistics:

2x CTR

Mobile ads using geofencing have double the click-through rate (CTR).

75%

of consumers will complete an action if they receive a message when approaching a specific location.

53%

of shoppers visited a retailer after receiving a location-based message.

The Advantages of Using Geofencing

What else do your advertisers need to know about geofencing? Here are some more points that can strengthen the case for it:

  • Target better: If you can be more precise with targeting, consumers receive more relevant messaging, which typically means greater engagement. Ads the shopper sees are more personalized. 
  • Spend smarter: Your advertisers will appreciate that they’re spending their ad budget on consumers most likely to engage with their brand. They’ll feel more confident about continuing to spend, as well.
  • Collect more data: With geofencing, you’ll be able to gather data about interactions and which ad types, messaging and locations are performing the best. You can also determine traffic patterns of shoppers and how long they dwell. You can use what you learn to tweak campaigns. 
  • Compete stronger: Your advertisers can also use geofencing for a competitive advantage, targeting customers in the virtual spaces of their competitors. For example, shoppers could receive a special offer that could motivate them to buy from your advertiser instead. A great example of this is Dunkin Donuts. They geofenced around other coffee shops, sending a coupon to consumers, leading to many redeeming them.

 

Best Practices for Geofencing

You can geofence in many channels, and some will be more accessible for your advertisers. For example, for mobile messaging, you’d need consumers to opt in. Ads on social and online are easier. Any way you decide to leverage, keep these best practices in mind:

  • Create a narrow geographic scope: In most cases, you want to stay small because someone that’s 30 miles away probably won’t pop in to your advertiser’s store. Generally, the radius should be around a five-minute walk. However, if your area is more rural, you might want to expand this.
  • Include a clear call to action (CTA): If you’re geofencing, you need an urgent CTA that immediately draws people to the location. So, something like, “Today Only: Free Dessert with Purchase.”
  • Make geofencing part of an integrated campaign: You’ll be able to provide stronger ROI to your advertisers when you supplement geofencing with other tactics, including radio, TV and search engine marketing. 

 

Answering “What Is Geofencing?” for Your Advertisers

You now have the information, examples and stats to take to your advertisers to get their buy-in on geofencing. This is an ad tactic they can test out to see how it goes, and those results could be fruitful for you and them!

Learn more about location-based advertising and pairing it with updated brand messaging in this Aspire post.