Traditionally, if a marketing service provider were to talk to a client about a direct marketing strategy, they’d likely be discussing targeted physical mailers sent to businesses and residential addresses. But like many other modern marketing strategies, technology has redefined direct marketing at its core.
In the modern marketplace, direct marketing and digital marketing strategies have converged through email and social media, resulting in highly targeted campaigns that hit inboxes and mobile devices.
In this article, we’ll take a deep dive into location-based mobile marketing looking at the following topics:
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What is location-based mobile marketing and how does it function?
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What does location-based mobile marketing mean for small businesses?
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What resources are needed for location-based mobile marketing?
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How can small businesses best use location-based mobile marketing?
Location-based mobile marketing at a glance
With the average American checking their cell phone up to 96 times a day[1], mobile platforms cannot be ignored by marketing professionals. While other strategies draw leads through an established customer journey, digital direct marketing strategies are designed to increase customer engagement by reaching recipients when and where they are most likely to engage with your message.
What is location-based mobile marketing?
Location-based mobile marketing strategies allow marketing teams to deliver meaningful and pertinent information to a consumer at exactly the right time and place. The marketing material can be sent via push notifications according to a number of different triggers, such as demographic data, geographic location, proximity to specific locations, or as part of an event (like a festival or sporting event).
How does location-based mobile marketing work?
On the back end of a brand’s mobile application or website, location-based mobile marketing requires the confluence of several technologies in order to function properly.
Permission to track
Perhaps the most important element of location-based mobile marketing is that–at some point–the recipient must opt in to receiving marketing and advertising messages based on their location.
Even with increasing privacy protections for consumers, our devices are constantly collecting a combination of location and usage data. Many users opt into allowing businesses to use this data in exchange for the convenience of personalization and special offers.
Location-based marketing methods for targeting consumers
Once a customer has given a business access to their device’s real-time location and personal data, there are a number of ways businesses can use that data.
Geofencing
Geofencing uses a combination of your device’s global positioning system (GPS) technology, IP address, and radio frequency identification (RFID) reader in an attempt to pinpoint your location. When any of these technologies reveal your phone to be in a specific area tied to a tracking cookie that you’ve given permission to, the associated marketing automation will be triggered and you’ll receive targeted messaging from that business.
Geotargeting
Geotargeting allows advertisers to tap into a device’s data to identify ideal customers based on demographics, purchasing habits, interests and hobbies, and routine behaviors. This data is combined with location data to allow special offers to be sent to ideal customers when they come within a certain radius of a niche boutique, for example.
Geoconquesting
Combining geofencing, geotargeting, and competitor analysis, businesses use geoconquesting technology to redirect potential customers away from competitors’ storefronts or products and towards their own. This is accomplished by setting locational triggers and geofences to competitors’ locations.
Proximity Marketing
Modern mobile devices are capable of providing extremely precise location data, allowing brands to deploy an even more granular form of hyperlocal geolocation and drive business in very specific ways. Proximity marketing can be executed within a department store, for example, through the use of beacon technology, RFID, or near-field communications (NFC) technologies.
This technology can determine if a shopper approaches certain brands or specific items. These shopping behaviors might reveal patterns that can be used to target ideal customers with special offers for nearby attractions or restaurants.
What does location-based mobile marketing mean for small businesses?
Marketing technology has come a long way toward helping small businesses compete on the international stage against their larger corporate competitors. Tactics like location-based mobile marketing, however, allow small businesses to truly stand out and shine in their chosen niche and local community.
When to use mobile marketing…
There are several industries where location-based marketing campaigns generate amazing results for the companies that use them. Retail stores and service providers, restaurants and bars, grocery stores (both traditional and specialty), seasonal retail pop-ups, and automotive dealerships are all examples of businesses that thrive when their marketing teams lean into location-based targeting.
While location-based marketing is typically focused on driving new traffic to physical stores, it can also be used to redirect competitor’s customers toward your brand. This can be especially helpful for niche, eCommerce-based businesses that have popular brick-and-mortar competitors.
For example, if your business sells a specialized hardware tool online, you might use location-based marketing to lure customers away from big-box hardware stores.
Sometimes the unique value-add is that you’re running a sale or special event that none of your competitors can match. Especially if you are providing access to high-demand, difficult-to-acquire products or services, location-based tactics can help drive a very specific audience to your doorstep, virtual or otherwise. In this way, mobile marketing can help achieve results in objective-based campaigns that other types of marketing might not be able to deliver.
…and when to not use location-based tactics
Location-based mobile marketing isn’t always the right approach for every business. For example, in situations where there isn’t a scalable audience present or if your business isn’t at least partially reliant on foot traffic, you probably don’t stand to benefit significantly from location-based marketing.
Similarly, location-based marketing isn’t generally as effective for products or services that are not truly niche or unique. Products and services that are unique to your business stand to benefit most from location-based tactics. When trying to market items or services that are readily available through other vendors, you’re typically better off focusing on what makes your brand desirable and unique as a differentiator.
As a marketer working to drive traffic to specific areas, it’s important to be ever-mindful of businesses in the area and the privacy of the user data being gathered by location-based strategies. Services that help marketers create location-based mobile campaigns should have strict standards in place to protect data privacy and prevent data collection in sensitive areas like healthcare facilities or schools for children.
How effective is location-based mobile marketing?
Location-based mobile marketing leans into the same consumer behaviors that have made “near me” searches on Google popular over the last decade—in fact, 46% of all Google searches are seeking local information and 88% of people performing local searches on a smartphone will call or visit a business they find within a day[2].
Despite growing privacy concerns in other channels, studies show that 70% of users have no issue sharing their location through a mobile device in order to get something of value. And the conversion rates around location-based mobile marketing support the quid pro quo approach, with tactics like geotargeting resulting in a 75% increase in conversions and a 146% increase to bottom-line revenues[3].
Advantages of leveraging location-based mobile marketing
Small businesses can gain a number of competitive advantages by using location-based mobile marketing tactics:
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Increased value and relevance in advertising messages.
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A more segmented and targeted audience for each of your products and services.
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Improved customer experience and a more robust customer journey.
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Increased foot traffic and sales conversions.
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More direct and timely connections with leads.
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Improved overall performance in search engine results.
Disadvantages of location-based mobile marketing
Along with its numerous strengths, there are a number of challenges that marketers should be aware of when it comes to location-based advertising. Perhaps the biggest among these are the looming federal, local, and international regulations and restrictions coming down the pipeline regarding consumer privacy.
Similar to the General Data Protection Regulation (GDPR) passed in Europe in 2018 to protect consumer data privacy, California passed the California Consumer Privacy Act (CCPA) the same year. The act was expanded and amended in 2023 by Proposition 24 (CPRA), further protecting consumers in how their data is collected and used by businesses [4].
Protections guaranteed by the combination of these two pieces of legislation include:
- The right to have collected data be deleted, with some exceptions
- The ability to opt out of the sale or sharing of personal information
- The right to know what information has been collected and how it will be used or shared
- The right to non-discrimination for individuals exercising CCPA rights
- The right to correct inaccurate personal data
- The ability to limit the use and disclosure of sensitive personal information
California is now one of nine states to have enacted comprehensive data privacy laws [5]. The other eight states are:
- Colorado
- Connecticut
- Utah
- Virginia
- Iowa
- Indiana
- Tennessee
- and Montana
Other states that have enacted less stringent protections include Washington, Nevada, Minnesota, Maine, Vermont, Delaware, and Michigan. A number of other states have introduced privacy laws in 2023, showing that there is a willingness by legislators to support the growing desire for privacy amongst consumers.
While these laws shouldn’t drive marketers away from using location-based mobile marketing altogether, the environment around data protection does call for constant education and awareness.
Resources needed for location-based mobile marketing
Implementing a robust, location-based mobile advertising strategy for a business with a physical location, such as a specialty retailer, requires the installation of devices that can read, transmit, and redirect the signals being emitted by consumer mobile devices.
These technologies will use RFID, NFC, or GPS information to pinpoint the consumer’s location and trigger the marketing outreach.
Software solutions
On the back end, marketing professionals use a range of software platforms managed by software-as-a-service (SaaS) vendors to create and manage their mobile marketing campaigns[7]. By using these centralized databases, marketers can ensure visibility for their brand when searches for local service providers are executed by consumers.
Top techniques for location-based mobile marketing
Whether you use an agency, freelancer, or in-house team to help you with your location-based marketing strategy, here are a few best practices to help make your campaign as effective as possible.
Use direct marketing to establish your authority
The localized content marketing that you send via direct methods should not only be informative, but it should also convince the consumer that your services or products are exactly what they’re looking for. The goal is to come across as helpful and solution-oriented, rather than to bombard your customers and leads with a constant stream of ads.
Leverage Google Analytics to find your ideal customers
While you might be using other platforms to perform the actual marketing outreach, Google Analytics can help provide the necessary insights to ensure you’re marketing to the right potential customers and leads.
Be tactical in your geofencing efforts to deliver timely messaging
With a proper understanding of your customers, you’ll be able to establish geographic triggers in the places where your customers will most likely be receptive to your marketing efforts. If your mobile marketing is being sent to them when they aren’t in the mindset to shop, you could be perceived as spamming them and they might go to the effort of opting out of your marketing.
Leverage local SEO tactics
Remember that your mobile marketing triggers are often tripped by searches in Google, so you want to make sure that you’ve integrated strong local search engine optimization (SEO) measures to increase brand awareness and ensure that your business is positioned for optimal ranking in search engine results pages (SERPS).
Pair location-based marketing with PPC advertising and social media
In order to get the traffic that you need, it’s helpful to run ads for particular locations and location-based keywords, and build your geofencing and triggers around those advertisements. This will ensure that your information will reach the right consumers.
Similarly, social media marketing provides a powerful foundation from which to execute local-based mobile marketing. Trust and social proof is built into advertising in social media channels, and through building and cultivating an audience out of your followers, you have a community that will implicitly trust your mobile marketing content.
Understand that you’re working from the bottom of the sales funnel
Customers at the top or middle of your funnel inherently aren’t primed to make a purchase. Consumers in those funnel stages are simply searching for solutions or exploring their options.
Dominate your PPC, keywords, and SEO for your local market, and you’ll be able to craft your marketing efforts around customers who are ready to spend their money right now, not at some unknown time in the future.
Don’t market locally without location-based mobile marketing
In this article, we’ve provided an introduction to location-based mobile marketing. But there are many nuances to crafting your mobile marketing campaigns that only seasoned marketing veterans will understand.
If your in-house team needs support in integrating mobile marketing or if you’re looking for an agency that understands the intricacies of digital marketing, you can search for a solution through the UpCity Marketplace, where you’ll find highly-rated experts skilled in executing these types of campaigns.
Sources
- 20 Vital Smartphone Usage Statistics [2023]: Facts, Data, and Trends on Mobile Use in the U.S., Zippia
- 16 Stats That Prove the Importance of Local SEO, HubSpot
- How Does Location-Based Mobile Marketing Work?, Udonis
- California Consumer Privacy Act (CCPA), State of California Department of Justice
- Which States Have Consumer Data Privacy Laws?, Bloomberg Law
- 7 Top-Rated SMS Marketing Software, Capterra