Imagine a customer pulls up their Expedia app and books a ski trip to Colorado. They book their hotel and schedule their flights, so the transaction is complete, right?
If apps were integrated (i.e. if they shared information), that purchase could prompt a message from The North Face or Patagonia noting that they haven’t bought a ski jacket in a while. Using that same shared information, they could ship the jacket straight to the customer’s Vail resort or, for no extra charge, have it waiting for them at the nearest retail store.
Add on the geo-targeting capabilities of iBeacon, Apple’s geo-location technology, and that same purchase could prompt the nearest grocer or health food store to recommend buying and packing Clif Bars to fuel the same customer’s upcoming skiing adventures.
We don’t have these advanced capabilities quite yet, but it’s anticipated that this type of advanced geo-targeting is on the horizon and will make for some exciting breakthroughs for marketers.
Is Geo-Targeting the Next Big Thing?
As brands are able to collect increasingly complete consumer data, they’re better equipped to understand and address their customers’ wants and needs. With a more complete customer picture – backed by data – brands can more easily cater to the most important aspect of their business: the customer. While brands increase retention and win more sales, customers enjoy a more streamlined, personalized buying experience.
This is why national brands are seizing local, geo-targeted advertising. Two-thirds of them report seeing better ROI and higher customer relevance from it, and four out of five customers say they want search engine advertising to be tailored to their location. In fact, consumers are 250 percent more likely to buy something after a search with local intent than after a non-local search.
Starbucks, for example, jumped on geo-targeting in 2010, delivering coupons to customers’ smartphones when they were within a certain distance from a store. And Zoopla, a British real estate property website, took an ingenious approach by piping electronic ads for available properties onto taxis based on the cab’s location in 127 London postcodes.
What’s Holding Geo-Targeting Back?
While geo-targeting stands to offer marketers a bounty of benefits, the technology doesn’t yet work perfectly. While it’s quickly improving, the aspirations are currently outpacing the implementation.
For example, imagine Whole Foods receives information from business software company MINDBODY that a shared customer takes weekly yoga classes, and info from Allrecipes.com that they only save vegan recipes. Using iBeacon, Whole Food’s could then send that customer an offer for vegan hamburger patties when they’re within 50 feet of the veggie burger section. Sounds great, right? Except that, as it currently stands, Apple’s iOS and Google’s Android are accurate to within 100 meters only 34 percent of the time. However, the aspiration are there and it’s important to keep these potential capabilities in mind for your brand.
Right now, some methods work better than others. Currently, assisted global positioning chips work the best. Wi-Fi comes next, but most people aren’t connected to a network when they’re on the go. Cell towers work, but poorly because tall buildings can interfere with the location signal. IP addresses are even worse, but not as bad as simply asking someone for his zip code.
But, as with any major technology advancements, growing pains are to be expected – don’t let them fool you. Geo-targeting technology is only getting better. Even as it is now, the percentage of ad requests containing geo-data has increased from 10 percent to 67 percent in the past few years. All signs point to the assumption: geo-targeting is here to stay. The question is: do you want your brand to stay ahead of the curve?
How to Use Geo-Targeting to Build Your Brand
To prepare yourself to use geo-targeting effectively, you must have ample customer information, as well as partnerships with retailers, in order to offer the personalized experience your customers’ desire. And if you’re thinking customers will never assent to giving away their data, don’t. Let the market evolve. As geo-targeting proves itself and consumers see the value in the trade, you’ll likely discover they don’t mind sharing their data.
Next, you need to be ready with your message. All the technology in the world can’t save a poorly crafted ad. Consider these tips:
- Develop highly relevant content. If your content isn’t relevant and valuable to consumers, it’s missing the point. Start slow, and tailor messages based on broad demographics such as age, gender, and location. Then, feed the information into a mobile user database system such as Weve.
- Don’t overwhelm consumers. If you’re holding “the biggest sale of the year” every other day, you’re going to be ignored. If you use geo-targeting just to say “hi,” you’re going to get turned off. This is a powerful tool that should be used judiciously to relay specific, timely, valuable information – use it only to deliver highly authentic, personalized messages and offers.
- Know the room. While the content of your message shouldn’t be a casual “hello,” the tone of your messages should be. You want to be friendly, but not overzealous. If your content is relevant and useful, a pleasant, direct notification of the offer available is all you need.
- Track your data. When it comes to geo-targeting, data is key to understanding your customers. You need to track how your customers are responding to your ads in order to improve your messages. For example, you might run an A/B test to uncover data about which ads are most successful in front of different audiences. Track your results – what types of customers are responding, the time of day, etc. – and act on what you find. Consider running a test campaign in a few stores as a proof of concept before rolling out a full-scale effort.
Although the kinks are still being ironed out, geo-targeting should definitely be on your radar. With this tactic in your arsenal, you can learn more about consumers, develop a more relevant and valuable experience, and ultimately drive them to purchase from your brand.