Winning Combo for Local Businesses: Geofencing and Social Media

By Nate Vickery

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In order for products or services to reach customers, their seller first needs to make prospective customers aware of the offer. Also, they need to remind or update both the existing and potential clients about what makes the offer superior to the competitor’s. Needless to say, it should be done at the right time, targeting those more likely to act upon your message. Luckily, this seemingly impossible task is becoming increasingly accessible with the development of geofencing.

Application in general

This concept of establishing virtual boundaries around a designated area has found its application in many aspects of everyday life, such as monitoring (e.g. an unauthorized employee entering a restricted area or a vehicle from a company fleet diverging from the course), law enforcement (ankle bracelet) and marketing, to name but a few. Smartphones, tablets, smartcards and other devices that use the global positioning system send information about our current location. They can be used as a powerful tool by those wishing to improve their business results.

Specific application

Although it can have various applications, geofencing is generally believed to be especially convenient and potentially potent advertising tool for smaller, local businesses. Unlike more widespread and global companies, these enterprises mainly rely on the people around their place of business. A shrewd owner of a local business would not want to throw away money on advertisements which would reach those who realistically cannot respond to an offer. So, instead of carpeting, they use targeting.

Communication channels

There are several ways a customer can be reached instantly upon entering a geofenced zone:

  • SMS – a short message is sent to a person in the vicinity of the place of business, informing them about the offer (e.g. daily specials at a restaurant, a happy hour at a bar, 50% off T-shirts in a store, etc.)
  • Ads on web-pages visited while the prospective client in within a geofence zone
  • Using social media (Facebook, Twitter – particularly interesting because of the Buy button, etc.)

Necessary tools and knowledge

Naturally, it is the best idea to hire an agency or a freelancer who would create a tailor-made website or an app. Still, if there are serious budget constraints, and there often are, there is an option to exploit some easy-to-use and practical app maker platforms. In fact, everyone can build their own app that can published on all three platforms (iOS, Android, HTML5), as long as they know what they want from it. Many articles, regular webinars and video tutorials are available to help those who might be daunted by the prospect of creating their own app.

Features

Among the features available, users can choose and tailor their app to include the following features: purchasing (managing orders, cash flow, etc.), loyalty programs (keeping track of loyal customers and offering special deals to them), integrated multimedia (music, video and gallery pictures can all be easily incorporated), 3rd party integration (Facebook, Twitter, RSS feed, mailing list, etc.), push notifications (possibly the most interesting option for advertising, allowing SMS to be sent once the potential client enters a geofenced area, informing them about special deals, news, offers and even facilitating in-app purchase) and data analysis (a priceless tool for decision making).

Potential obstacles

As in most other aspects of the application of modern technology, privacy is the issue people are most concerned about. Whether a SMS received from a vendor would be seen as a kind gesture, informing a user about the offer or as invasion of privacy, thus creating a negative association with the company that send the message, is the key question. Naturally, businesses should only target those who have agreed to share their location by installing a piece of software and who have specifically agreed to be informed about new products, services or offers.

Potential benefits

By improving the focus of an advertising campaign and targeting only those who might actually become or remain loyal customers, the ROI is likely to increase manifold. Offering a mobile platform, either as a unique selling proposition or simply a conveniently designed piece of software, would strengthen the customer loyalty. For smaller, local business this might be the crucial step they need to take in order to survive, since it has become obvious that the “Buy local” slogan just isn’t enough.

 

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