Location based marketing

Friday 04th, March 2016

You walk into an Apple store in the US. Your official Apple Store application for iPhone will let you shop for new items, check to see if your phone is eligible for any upgrades or pick up an order that you have placed earlier.

One of the new kids on the block of digital marketing, Location-based marketing treads the fine line between super-cool and slightly creepy!

Mobile devices that the customer carries, pinpoint the actual spot where he is. And marketing messages that are relevant to him and the place where he is, are sent to him. There is the sophisticated approach where the customer opts in or signs up for messages from certain vendors, or certain types of messages. And there is the kind where the customer, searches for specific products or services in the area that he is in.

Geo-fencing is a form of location-based marketing where a section on a map is chosen as the target area and the people within that are sent offers, push notifications and other kinds of communication.

Beacons are an example of location-based marketing. Beacons send small packets of information, from distances of between two inches to about 50 meters depending on the environment. When a smartphone comes into range, the beacon’s signal triggers content from either a local database or cloud-based storage. The smartphone user will then see a notification on their home screen saying a discount, reward incentive or contextual suggestion is near by – even if the phone is locked. Beacons are gaining a lot of traction with retailers or brands because it gives them the opportunity to communicate directly with shoppers not just at a store level but in an aisle or even at a fixture.

So why is something as wonderful as this bordering on creepy?

In 2 words – customer privacy.

Customers are concerned that the marketer or the retailer knows where you are, where you are going, how often you go there and how much time you spend there! In many surveys and studies done, at least 50% of the people do not want to be tracked saying that it was an invasion of their privacy. Some people are willing to give out personal information based on some conditions – if they got any special offers or discount coupons. But privacy is a huge issue!

Most people in that area are not even aware of the fact that they are being tracked!  And now there are Apps that you can download which block tracking and access to personal data.

When done right, customers are happy with the kind of convenience that is available to them – as location-based marketing addresses issues that they are concerned about right at that minute. But it is so easy to make a mistake and lose a customer – just like that! Because crossing the line even a little bit becomes a little too much for most people

It is a good idea to let your customers decide what they want – about the kind of messages that they would get and how often they would like to be contacted.

Marketers should also be careful about the data that they are using to understand the location and preferences about a customer. Meaning – there is so much data floating around, it needs to be carefully sifted and understood. A person could be travelling to San Francisco on work and posting updates on Social Media from there. But his content might be all about home in Los Angeles.

Like in everything else, knowing your customers is paramount.  Enough cannot be said about the importance of that. You should know how to interpret the data that you have. You need to have a clear strategy and plan as to what you want to do with all the information and your “captive” audience.

Location based marketing allows a marketer to engage with a customer at the right time and at the right place by sending him the right messages. But it can go horribly wrong, if not done right.

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