Geofencing Meaning: What Is Geofencing Marketing? [+5 Benefits]
What is geofencing, and how can it attract more local customers to your business?
Geofencing marketing is an effective marketing strategy that can help get more local customers through the door. This strategy works by enabling you to target people as they physically get closer to your business and send them irresistible offers to get them to come inside.
On this page, we’ll cover what geofencing means and share five ways geofencing benefits your business. If you want to learn more about how geofencing solutions can help your business earn more customers, contact us online or call us today at 888-601-5359 to speak with a strategist about WebFX’s customizable geofencing plans.
Geofencing meaning: What is geofencing?
Geofencing marketing is a system that allows you to define geographical boundaries to send alerts to potential customers when they get close to your storefront. By definition, geofencing means that you set up a perimeter around a location, and when a user enters or exits that boundary, they get an alert from your business.
So, how does geofencing work?
Watch our video from a geofencing expert and keep reading to learn more!
To start, you set up alerts that are active or passive. An active alert requires users to opt-in to location services. Once opted into location services, users will receive a message from the business when they have the company’s app open and pass through the barrier.
With active alerts, you utilize either Global Positioning System (GPS) or radio frequency identification (RFID) to build your barriers and send alerts. This technology is why your audience has to have their location services turned on to reach them.
Passive alerts, on the other hand, are always on. These alerts rely on users being connected to WiFi or using cellular data to send alerts when users pass. If your smartphone location is turned on, passive alerts will continually work in the background.
Once you know the type of alert you’re interested in utilizing, you can decide on the promotion, the size of the fence, and what you want to use to trigger your promotion.
How to set up a geofence
It’s simple and easy to set up geofencing for your business. You choose the area that you want to target and how far you want it to extend.
When you create your fence, you’ll want to keep your radius small. The size will depend upon whether people walk or drive to your business.
If your customers primarily walk to your business, you’ll want to keep your geofence within 4-5 blocks of your business. This distance is close enough to attract people to your storefront, but not so far that they have to walk a long way to get there.
On the other hand, if your customers travel to your business primarily by a vehicle, you can extend your radius further. You can make your geofence spread 4-5 miles to ensure that you reach people as they get closer to your business.
What types of alerts can you use with geofencing?
Many types of alerts can be triggered when someone enters a fence. Some of these alerts include:
- Text messages
- In-app notifications
- Ads on social media
You can use any of these alerts to reach your audience when they enter your geofencing barrier. Most companies use social media ads or in-app notifications to reach people. It’s a great way to get people to visit your real business and make them more likely to shop.
Common marketing applications for geofencing
There are many applications for geofencing. Let’s take a look at a few of the ways you can integrate geofencing into your business’s marketing plan.
1. Social networking
Snapchat utilizes geofencing technology to create location-based filters, stickers, and more. If you ever send a Snapchat at a specific location and see a filter for a business, that’s geofencing technology.
If your company uses Snapchat, you can create location-based filters to help increase brand exposure when people are in or near your business. It’s a great way to use geofencing to increase brand exposure.
2. Audience engagement
Geofencing marketing also helps to increases audience engagement.
With Snapchat, geofencing encourages your audience to interact with your filter and share it with friends. You encourage your audience to post photos with the filter and share it with their friends.
Additionally, geofencing is great when you host events. Whether it’s a concert, festival, or conference, you can use geofencing for crowdsourcing social media posts about your event and sharing them.
Geofencing is an excellent tool for marketing your business. It’s a popular medium for delivering in-store promotions to your audience.
When people enter the fence, you can send them coupons or discounts to entice them to visit your store. Shoppers are much more likely to visit a nearby store that offers coupons as opposed to one that doesn’t.
5 benefits of using geofencing marketing
Now that you know the geofencing meaning and practical applications let’s take a look at how this strategy will benefit your business.
1. Geofencing makes it easier to reach customers
Geofencing allows you to reach customers at the right place and right time. Since geofencing operates on a virtual barrier system, you reach customers as soon as they enter that barrier. It means they are close to your business and can become a potential customer for you.
When you use geofencing, you reach people right on their mobile devices. This process means that you can put promotions for your products or services directly in your customers’ hands.
The average mobile session is 40 minutes. People are spending long periods on their phones, so why not reach them where they are? It’s a great way to drive people to visit your business on a whim when they may not have previously planned to stop in.
2. Enhance local sales
Geofencing marketing helps you build a better local marketing campaign.
Local marketing helps you earn more conversions and grow your business. Geofencing marketing is an excellent stepping-stone to getting those leads through the door of your business.
As a geofencing example, let’s say you’re offering 30% off everything in your store. By creating a geofence, you can send people notifications in their app or show a social media ad advertising your store’s sale. This geofence will get more people in your store to check out your sales and buy your products.
3. Increase engagement
Geofencing helps you increase engagement with your brand. When you send offers directly to your audience, they’re more likely to engage with your business and see what you have to offer.
People only want to see offers that are relevant to their interests and needs. When you have tailored offers that you send at the right time, it increases the odds that your audience will engage with your brand and visit your store.
4. Personalizes your customers’ experience
As we stated previously, people want to see offers that are relevant to their interests. Personalization is the key to a successful marketing campaign.
Your audience is bombarded with advertisements and offers from dozens of companies. If you want to make your offer memorable and exciting for your audience, you need to personalize it.
Geofencing helps you understand your audience better to create offers and ads that appeal to your audience continually. This strategy allows you to collect data on your customers, such as demographics.
You also see which offers produce more engagement and interest. Combining these elements allows you to understand your target audience better, so you can create offers that get more people in the door of your local business.
5. Helps increase brand awareness
When you take advantage of geofencing marketing, you help build brand awareness for your company. You put your brand in front of your audience and get them to think about your business.
It’s a great way to remind your audience to choose your business over the competition.
6. Helps you beat out your competitors
One of the great things about geofencing is you can put a geofence around your competitor’s place of business. If someone enters the fence, you can send them an offer and entice them to visit your business over your competitors.
Let’s look at companies like Starbucks and Dunkin’. These two companies are popular among consumers, and many will visit one store or the other. With geofencing, Dunkin’ could take potential customers away from Starbucks with an enticing offer and vice versa.
Without the geofence, someone may have just visited the closest coffee shop because it was convenient. Getting an offer for $1 coffee at one place, however, could easily deter someone from visiting the closest coffee shop and drive them to the coffee shop offering $1 coffee.
Geofencing is a great way to increase brand awareness and get your audience thinking about your brand instead of the competition.
Ready to start using geofencing to target more local leads?
So, what is geofencing when it comes to your business? Geofencing marketing enables you to reach local customers that are near your store or a competitor’s store. It’s a great way to entice local customers to visit your store and check out your business.
If you aren’t sure how to get started with geofencing, our team of over 200 experts can help you create a geofencing strategy that drives results. We have the knowledge and expertise to help you create a campaign that will drive more local leads to visit your business.