Geofencing Definition: What Is It, and How Can It Help My Business in 2023?

As a local business, you should always look for new ways to attract leads. Geofencing is a great way to get people to visit your store and make a purchase. It allows you to target people in the nearby area and send them information that entices them to visit your store.

On this page, we’ll discover geofencing definition and meaning, and provide you with eight tips for implementing an effective geofencing campaign.

If you want to learn more about how geofencing can help your business drive local traffic, call us today at 888-601-5359 to speak with a strategist.

Let’s get started!

What is geofencing?

Geofencing definition is the process of setting virtual boundaries to target people that enter a certain area. You set a radius around your business (or a competitor’s business) that triggers action when people enter into this radius, remain in it, or exit it.

How does geofencing work?

Imagine that you built a fence around your business and the sidewalk in front of it. When people open the door to the fence, someone from your business would be standing there and tell them details about a sale you’re hosting.

From this information, someone might physically go into your business and take advantage of the sale. Another person may hang out in the area and then decide to leave. As they’re heading through the door of the fence, your employee would remind them one more time about your great sale.

This is how it works, except there is no physical fence or employee standing at the fence. Instead, you set a virtual boundary and when someone enters or exits that boundary, they receive a certain type of notification to grab their attention and get them in the door.

What are the types of geofencing?

There are three types of technology you can use for geofencing:

  1. GPS: The Global Positioning System, or GPS, uses a network of satellites orbiting earth to triangulate an individual’s location. You create a perimeter based on this location.
  2. RFID: RFID stands for radio-frequency identification and is a Bluetooth technology that uses radio waves to connect with one another.
  3. Beacons: Beacons operate through a Bluetooth signal. It sends a message when you’re physically close to a beacon. This technology requires an actual device to use it.

When users enter your set geofence, it triggers a text message, notification, or an ad to appear online. It’s a way for your business to communicate with people through devices within your set space. Your business can send messages to get your audience to visit your physical location.

Geofencing allows you to set up three actions:

  1. Enter Notifications: This is sending information to audiences when they enter your geofence.
  2. Exit Notifications: This is sending a message to those leaving the geofence to try and get them to come into your store.
  3. Dwell Notifications: When people spend a lot of time in your geofenced area, you can send them notifications to invite them to visit your business.

Most businesses target users on their mobile phones, though you target people through tablets and desktop computers, too. When geofencing on mobile, your notifications will only appear if someone allows you to send them notifications. If they block location services, you won’t be able to reach that person because they aren’t sharing their location.

Geofencing works well when you’re targeting people who are stationary or walking in the area. You don’t want to target people who are driving around, as they won’t (and shouldn’t) be checking their phones while driving.

This method is great for getting people to visit your business who might not have visited otherwise. In fact, 53 percent of shoppers visited a specific retailer after receiving the location based alert. Over half of those who visited said it was unplanned, meaning the notification prompted them to pay an unexpected visit.

Geofencing is a powerful tool to get leads to visit your business that might not visit otherwise. It’s a great opportunity to earn more valuable leads for your business.

Where can you use geofencing?

Geofencing can be used in numerous places. Here are five places you can implement geofencing:

1. In-app

This is the most popular option that businesses choose. If your business has an established app, you can easily provide your audience with the option to opt-in for notifications. It allows you to send your audience coupons, offers, and deals.

2. Texts

With the increase in unlimited texting plans, users are more open to signing up for text message notifications. This is another great way for your business to send deals to your customers when they enter your geofence.

3. Third-party apps

Many shoppers use third-party shopping apps, such as RetailMeNot, to get coupons and deals. If you have offers on these third-party apps, you can send a geofenced notification to users to use your coupon.

4. Social media ads

When people are out and about, they often check social media. This is a great opportunity to share run a social media ad to attract leads to visit your business. Did you know that you can opt for geofencing on Facebook?

5. Pay-per-click (PPC) ads

Users may conduct searches when they’re out visiting businesses. You can run a PPC ad when someone is in your geofence to get them to visit your business. It’s a great way to attract interested leads.

Geofencing vs. geotargeting

As you look into geofencing meaning, you’ll see information about geotargeting. These two methods might seem similar, but they differ greatly:

Features Geofencing Geotargeting
Technology Cellular/WiFi/GPS IP-Address
Target Range Medium to Large areas (stores, neighborhoods) Large areas (ZIP Codes, States)
Real Time Targeting? Yes No
Can collect location data? Yes No

There are many differences between these two strategies. The main difference that should be noted is that geofencing allows you to target people on mobile, while geotargeting does not.

Geofencing meaning is more focused on targeting users near your place of business to get them to immediately come in and visit. Geotargeting focuses more on reaching people at home and getting them to make purchases online or potentially visit the business within a few days. These are both great tactics to use, but it’s important to see where they fit better in your marketing plan.

8 geofencing tips to help you get started

Geofencing can be a great addition to your digital marketing plan. By harnessing this technology, you’ll get more customers to visit your business. Here are eight tips to help put you on the fast track to successfully using geofencing.

1. Know your audience

When you embark on a journey of geofencing, it’s important that you understand your audience first. These are the people you want to attract into your business. You’ll want to know them well to know what kind of content will drive them into your business.

Know what your audience likes and doesn’t like. You can take the time to segment your audience to provide them with the best content to get them into your store.

You can use behavioral data to deliver better content for your audience. It will help you see how your audience interacts with your brand and what they want to see from your business. You can better tailor your content to their needs when you know your audience better.

By knowing your audience, you’ll know what content to deliver to them. It will help you get more people in the door of your business.

2. Be upfront with your audience

When you use geotargeting, you must be upfront with your audience. You don’t want to use geofencing and upset your audience because they didn’t know what was happening or what information you’re taking.

This is especially pertinent with apps. Ask for permission to obtain information and tell your audience exactly what information you’ll be taking. People are more willing to share their information if they know what you’re taking and how you’ll use it.

Build confidence with your audience. If they feel confident in your business and can trust you, they will be more inclined to share their information with you. Sharing the benefits of them signing up to receive notifications can nudge them closer towards opting-in for notifications.

3. Keep your geofence small

When you start using geofencing, it’s always tempting to create a wide radius to reach as many people as possible. You want as many people as possible to visit your business, but a wide geofence won’t necessarily help your cause.

Generally, the rule of thumb is to keep your geofence within a four- to five-minute walk to your business. If your customers primarily travel by car, it should be a four- to five-minute drive.

Think of it this way: If someone lives 15 minutes from your business, is a push notification going to entice them to visit? They’ll be too far away to consider visiting your business.

On the other hand, if you’re only two minutes down the block, it’s more enticing for your audience to visit. They’re already in the area, so they’re more willing to walk or drive to your business.

By keeping a small geofence, you’ll get more people to visit your business.

4. Geofence the competition

You don’t have to limit your geofence to your business. A great way to draw people into your business is through geofencing your competition. You can get your audience to go to your place of business instead of a competitor’s.

When you set up the geofence by your competitors’ place of business, users will get a notification about your store. If you offer them a really great deal, it could lead them to head in your direction. It’s an enticing opportunity to get leads to choose your business over the competition.

Many big-name businesses already do this. Dunkin’ Donuts and Starbucks have geofences set up on one another to get users to choose one business over the other. It’s a great way to attract other leads to your business.

5. Target complimentary businesses

In addition to competitors, you can also create a geofence around complimentary businesses. These are businesses that offer products or services related to your business.

For instance, if you own a gym, you can target shops that sell athletic apparel. The athletic apparel store could do the same thing too! It’s a great way to find leads that you know will be interested in your business.

6. Don’t overdo it

When you send notifications or create ads, it’s important that you don’t overdo it. People don’t want to be bombarded by your business. If you send dozens of notifications in your app, you’ll annoy your audience and get them to opt-out of your notifications.

You may need to monitor your audience to see what the right amount of notifications is. This means you may only be able to send one or two notifications before your audience becomes annoyed. You’ll have to strategically plan when to send the notifications to make the biggest impact.

By being judicious with your notifications, you’ll run a more successful campaign that keeps your audience engaged.

7. Include a call to action (CTA)

Your call to action (CTA) is very important to your geofencing campaign’s success. If you don’t have the right CTA (or don’t have one at all), you’ll miss out on potential leads.

When you implement a CTA, make it impactful. Get your audience interested and make them want to click on the button to find out more. A CTA like “Get Coupon Code” or “Redeem Rewards” will allow you to tell your audience exactly what happens when they click and entices them to want to click.

A strong CTA will help your geofencing campaign. When you tell your audience exactly how to proceed, you will drive better results for your campaign.

8. Ask for feedback

Feedback is an important part of your business. You want to know how your audience perceives your campaigns and your business so you can make improvements. When you use geofencing, ask your audience for feedback if they visit your store from your notification.

You can ask them if the offer was enticing, if it got them to purchase, or if they were planning to visit the store. There are dozens of questions you can ask to get valuable insight into how your audience perceives your geofencing campaign. It will also help you understand how they experience your store and where you could potentially improve their experience.

It’s also great because it allows your audience to review your business while the experience is fresh in their minds. They can recall the experience better, which gives you more accurate insight into how your business is doing with your geofencing campaign.

WebFX will help you create a geofencing strategy that drives results

Geofencing is a great way to drive local traffic into your business. When done properly, you can reach customers at the right time and place, which leads to more conversions for your business. At WebFX, we will help you implement geofencing into your digital marketing plan.

We have a team of 500+ experts that will bring their knowledge and expertise to your campaign. Our team is knowledgeable in geofencing and will help you create a strategy that works for your business. With over 25 years of experience, you can count on us to help you create a geofencing strategy that drives results.

If you’re looking for a business that drives results, look no further than WebFX. To date, we’ve driven over $3 billion in sales and over 7.8 million leads for our clients. We focus on driving successful results for our clients first.

Don’t believe us? Just ask our clients! We have over 1020 client testimonials that attest to the great work we do!

Get started today

If you’re ready to start using geofencing to drive more traffic into your business, contact us online or call us today at 888-601-5359 to speak with a strategist.

We look forward to helping your business grow!