Search below for anything you want to learn about regarding digital marketing.  New content added daily!

What is Geofencing and How Does it Work?

Just as the name suggests, you may have guessed that geofencing involves something that is location-based or within a certain boundary. You are partially correct. However, these boundaries are exclusive to apps and other software platforms. This article will discuss everything you need to know about geofencing, from its definition, to how it works, and how can it be used as part of an advertising and marketing strategy.

how does geofencing work

What is Geofencing?

First, let’s explain what geofencing means. Geofencing is a location- or boundary-based service that is used for GPS and Radio Frequency Identification (RFID.) It helps companies target their coveted audience by providing a virtual perimeter. This means that businesses who use geofencing use GPS signals around their storefront (called a geofence) to specifically target their customers. Depending on how the fence is configured, when someone walks within its territory, they receive business-specific mobile push notifications, targeted social media ads or text message alerts. 

How Does Geofencing Work?

For geofencing to work, an administrator needs to set up the boundary (i.e. “geographical fence”) so when people walk into this fenced territory, they receive notifications and advertising from your business. This can be as simple as drawing a circle 300 feet around your store’s location on Google Maps using APIs when developing the mobile app. A geofence is defined within a code of a mobile app because users need to opt-in to location-based services for a geofence to work. There may even be an option to download an app at a specific event to deliver information.

Your customers can even set up geofences too, using their personal mobile apps. For example, an iOS reminder allows people to choose an address or location where you want to trigger a specific notification or alert. That being said, if a customer really loves Sunglass Hut, they can choose to receive targeted Sunglass Hut notifications when they enter its geofenced territory. 

what is geofencing

Can You Provide Other Geofencing Examples?

We totally get that geofencing is confusing. So we’re going to provide other examples of geofencing to help you better understand how you have seen it and how you can use it for your own business.

Starbucks

Starbucks uses geofencing to advertise their drinks to prospective customers. They typically send push notifications when people walk by a Starbucks shop or around the area within the geofenced region. 

Starbucks even sends personalized app notifications too. If a customer order a caramel macchiato, they will send this same customer a notification that entices the user to another caramel macchiato.

Dunkin’

Similar to Starbucks, Dunkin’ sends app notifications when users enter their geofence. Dunkin’ specifically markets their exclusive drink and food deals. 

Dunkin’ is also notorious for their Snapchat filters. When customers were by one of their stores, a giant sprinkle Dunkin’ filter would appear on Snapchat to engage users and get them in the door.

Uber

Uber relies heavily on geofencing to drive their sales. They specifically map geofences around airports, night clubs and hotels. When potential customers get off a plane, Uber sends them push notifications to let them know that Uber drivers are nearby to take them to their next destination. 

This type of geofencing is useful for driving services like Uber (and Lyft) because it helps them get more fares.

Johns Hopkins Hospital

Johns Hopkins Hospital seems like a weird user of geofencing, but they turned to it to hire more people. The hospital used geofencing to target people for job openings by creating social media ads that appeared in qualified users’ newsfeeds. Johns Hopkins specifically targeted people who had a background in pediatrics via Facebook and LinkedIn.

geofencing

How Can I Use Geofencing for Marketing and Advertising?

Geofencing is an increasingly common tactic in digital advertising. As you have just read, geofencing is targeted marketing for devices that enter a geofence. The most common types of geofencing marketing are pay-per-click (PPC) ads, text messages and push notifications. Let’s discuss these different types in further detail.

PPC (Pay-Per-Click) Ads

PPC ads are an excellent digital marketing strategy because you are buying traffic to your website, without putting in the time to earn it. A popular type of PPC ads is search engine PPC, like for example Google Ads, which allows advertisers to bid on keywords. If one of the keywords that they bid on is searched, their ad will be shown. Geofenced PPC ads are no different as your store’s ads will appear when a potential customer walks within the radius of its geofence. 

For example, if you sell jumbo cookies, you can use the keywords “large cookies,” “bakery items” or even “jumbo cookie” in your ads. Then, you can use the geofencing technology to put a perimeter around a 3-block radius of your cookie shop. If anyone is within this radius and uses your keywords, they will see your ad.

However, keep in mind that someone else who pays more for their store’s keyword in the same geofence will bump your ad off

Text Messages

If you have your customers’ phone numbers, you are able to target them with text messages. You can send automated text messages to them when they are within your geofencing perimeter, some of which include sending reminders to let them know they’re by your store or telling them about a sale or new product you’re featuring.

Push Notifications

A push notification is basically advertising for your phone- A push notification is sent to a mobile device and shows up on the home screen. If people have downloaded your store’s app, you are able to use geofencing technology to send them push notifications.

geofencing marketing

What are Other Uses for Geofencing?

So, you have some specific marketing strategies for geofencing technology and are ready to expand. What are other common uses for geofencing?

Social networking

If you have attended an event that allows you to share a customized filter or photos catered to that event, you have interacted with geofencing. Businesses try to enhance the consumer experience by using social media and geofencing by prompting a check-in or for you to chat with friends nearby. Once you leave the area, they will sometimes send you a review to fill out.

Marketing and advertising

We have already touched on how geofencing helps your business’s marketing and advertising strategies, but it can also deter people away from your competitors. You can create a geofence around your competitor and send notifications for people to shop elsewhere (ahem, your store.) With marketing and advertising geofencing, you can target consumers at colleges, events or trade shows. Its marketing strategy doesn’t just stop with advertising around your store.

Workplace and employee time tracking

Geofencing at the workplace allows an employee to clock in for their work time via their mobile phone. Conversely, when they leave their workplace, they are prompted to clock out. This way, managers are able to see who is on-site without being at the store, and it allows payroll to be accurate.

Personal location tracking

Parents can even use geofencing too! They can set geofences around their own homes, babysitters’ homes or schools, and when the kids come and go from these locations, parents get real-time alerts. 

People who even hate coming home to a dark or quiet house can set a geofence around their home. So, when combined with home automation apps like Google Home, the geofence can trigger lights or music.

geofencing definition

Why is Geofencing a Good Tactic to Utilize?

Geofencing has five main benefits, of which are discussed below.

Better targeting

By personalizing your marketing with geofencing, you can better target people, thus attracting more potential customers. 

Engagement

Consumers are more likely to engage with your brand if you provide them relevant offers in real time. Geofencing does just that! Because your store becomes more relevant at crucial times, your brand loyalty and advocacy is increased.

ROI

With geofencing, you are able to send notifications to people within your vicinity. Therefore, you are able to analyze the effectiveness and responsiveness of your campaign. You can use this knowledge to better optimize your marketing strategies for better ROI.

Efficiency

Because geofencing is highly targeted and location-based, it is a very efficient form of marketing. With it, you improve the impact that your communications create with your potential customers.

Better data

Once you implement this tactic, you gain access to data that can be used to generate insights, like which stores are performing better or which ages are more approachable for your product.  

Contact SEO Design Chicago for Help with Geofencing

As you know by now, geofencing is a highly effective way to reach your target audience. Out of all marketing companies in your area, SEO Design Chicago does the best job. We help you attract your intended customer base with their targeted ads. Contact us today for help with your digital advertising strategy

Contact Us Today!


Call Now ButtonCall Now