Tips, tricks, and information on topics to help small businesses succeed during the holiday shopping season
What is geofencing?
Geofencing is a revolutionary marketing method that involves virtually targeting customers in a certain geographical location. This process uses GPS or RFID technology to create a virtual fence around an area that a business wishes to target with its advertisements. Interestingly enough, geofencing has many other practical applications. Many companies have adopted this technology to perform actions when people leave or enter rooms, or enter a certain range from their location. For example, if you have downloaded the Starbucks app for your phone, an alert will pop up from your virtual wallet naming the location that you are near and providing a quick notification that if you press will open up your Starbucks wallet. This technology has provided businesses with the option to provide benefits to customers while creating an easy way to focus advertising on a geographical target audience.
How can geofencing benefit your business?
Geofencing can benefit your marketing initiative in many ways. Your business can use geofencing technologies to target specific demographics that you wish to focus your brand on. For example, take a jewelry store: jewelry stores tend to appeal to an audience with high amounts of disposable income. The business can use geofencing to place their ads in the areas surrounding large corporate offices downtown, because most likely, the offices there will have a large amount of disposable income. This methodology can apply to any business with any demographic they wish to target, so long as they have quantitative data to support the placement of their geofence.
Steps to implement a geofencing marketing strategy:
1. Identify your target demographic: Identifying a demographic or a few similar demographics is surprisingly difficult. A lot of times, businesses like to choose vague target demographics which can lead to very broad marketing plans. To avoid this, choose a demographic that your product or service is the most appealing to. Then, focus on ways that you can make that category more granular, to appeal to a specific audience within that demographic. Continue to do this until you have a target group of the population that would find your product or service necessary or considerably appealing to them. Note that you may have more than one of these groups that you wish to focus on, but make sure that the way your marketing plan is structured includes appealing to both of these demographics.
2. Create your advertisement: Sometimes when developing an ad, people create the ad first, then focus on who it might appeal to. It is important to identify your target demographic before creating the ad. Doing this allows you to research your demographic and find advertising strategies that target your demographic instead of just creating an advertisement that hopefully will appeal to them.
3. Implement your geofencing initiative: Once you have created your advertisement that you are fairly certain will appeal to your target demographic, you can locate specific locations that you wish to target. I recommend looking at census.gov to identify areas with a heavy concentration of your target demographic. The area that you wish to target could be as large as an entire city or it could be as small as a single block of the city. It is recommended, however, that you put your geofence in a 4 to 5-minute walking/driving distance radius around the area. Look through the most recent census data and find a zip code that fits your marketing initiative the best. Once you identify the location, reach out to a service that can help you place your ad in your desired area. Companies that provide this service include geofencing.com, go.groundtruth.com, and many other 3rd party companies.
TIP: start with one geofenced location and one ad developed specifically for a desired audience. Testing and fine-tuning is helpful, especially for those new to this type of targeting approach.
With smartphone usage being at its all-time high, geofencing will most likely become a prevalent marketing strategy in most businesses’ marketing plans. Geofencing is a revolutionary marketing strategy that can potentially increase sales for your business and help small businesses create targeted exposure. With 30% of the international population using location-based services, and 80% of these users wanting to get location-based alerts from surrounding businesses, geofencing is beneficial to both businesses and customers.
More information about geofencing can be found here: