Retailers have invested in location-based marketing at the national level for several years as an effective way to target offline audiences via online ads. However, we’re expecting to see a noticeable increase in investment in this marketing channel this year.
In this blogpost, we examine some of the core reasons behind this trend and why 2018 is set to be the year of location-based marketing.
Provide users with an omnichannel experience
9.46% of purchases in the US are currently made online. Despite this percentage increasing every year, consumers are still showing a preference for making purchases in stores.. Brick-and-mortar stores therefore remain a key channel for retailers.
E-commerce giants and pure players, Alibaba and Amazon, have recently made tactical decisions to increase their physical presences via partnerships and acquisitions. For example, Amazon recently acquired the organic supermarket chain Whole Foods, and opened their first retail store in Seattle in January 2018.
This trend is encouraging retailers to rethink the in-store user experience to help increase brand engagement. This includes implementing digital strategies such as providing tablets to look up/locate products, cashierless checkouts, and enabling users to be identified as easily in-store as they would be online.
It is clear that the barriers between the online and offline worlds are becoming increasingly more merged. Retail marketers are taking advantage of this by launching more mobile ad campaigns to help increase in-store traffic.
Target mobile users
According to a recent study by Mood Media, 50% of consumers (and 67% of young consumers in the US) want to receive promotions and offers from brands on their smartphones. Yet most retailers are still not taking advantage of this strategy.
Mobile is the ultimate link between the digital world and the physical. It is both a very personal and omnipresent platform. More often than not, consumers eat, sleep and shop with their smartphones nearby or within reach.
E-commerce retailers have access to a range of digital tactics to increase traffic to their websites to help them sell more effectively. However, this is not the case for retail marketers for brick-and-mortar stores. Mobile is a real opportunity for retailers as a channel to increase in-store traffic via location-based marketing and help boost retail sales.
Access insights from consumer location data
We have all used our smartphones to:
- Check the hours of operation of a restaurant or store
- Locate a store or point of sale
- Look up directions to a store or mall
- Learn more about a product (features, price, review, in-store availability etc.)
- Receive and/or use a special offer or discount
Evidently, geolocation data via smartphones can provide some extremely valuable insights.
The list of places where an individual has shopped in the past can provide strong clues to help determine their interests, preferences and their purchase intent.
The idea is to analyze this location data history to create consumer profiles helping marketers create better targeted ads and promotions.
Offer users a personalized experience
Operating in a competitive marketplace, retail marketers need to personalize their customer communications and shopping experience as much as possible in order to stand out.
Location-based marketing enables retail marketers to target their communications according to the type of consumer:
- Already a customer
- Not yet a customer
- A customer that also frequents competitor stores
Platforms specialized in “geo-fencing” also enable marketers to automatically target prospects within a certain geographic area in real-time with personalized messages and offers.
So there you have it, four great reasons behind the location-based marketing trend. Since attracting consumer attention is becoming more difficult, we expect to continue to see increasingly sophisticated ways to target potential clients based on location data over the next few years.
Teemo is a location-based marketing platform designed to help retail brands increase in-store visits. Campaigns are billed on a cost-per-visit basis so advertisers can ensure return on investment. Advertisers also have access to in-depth insights into consumer behaviors and interests. Request your demo today.