Location-Based Marketing: Reaching out to Customers on the Move

Location-based marketing has received great attention in recent years. The application possibilities are hardly limited.

Location-based marketing has received great attention in recent years. Location-based data is increasingly changing consumer behavior: people on the move are more and more frequently using services that make their daily lives easier or provide useful information. This trend also has an effect on the buying behavior: According to a current study, at least 30% of consumers worldwide use their mobile device (smartphone or tablet) as the most important aid to their purchase decision. That is why for many companies, location-based marketing is becoming a central component of their marketing strategy.


Location-based services are location-specific mobile services, primarily apps. They provide information or functions to smartphone users, depending on their location. When this technology is used by companies as a direct marketing strategy, it is referred to as location-based marketing. Location-based marketing offers marketers the opportunity to address users in an innovative and personalized way and send relevant messages at just the right moment.


The term geofencing is directly related to the topic. It triggers an action, such as sending a push notification, when a smartphone user enters a defined geographic area. Assigning not only location data, but also anonymized tags (e.g., age, gender, length of stay, visited shops) to the user enables an even more customer-focused and relevant communication. Having a corresponding app installed on the smartphone is the prerequisite for geofencing. The technology is not restricted to outdoor areas, but can also be used indoors. In buildings, smartphones are typically located via Bluetooth beacons or Wi-Fi: existing Wi-Fi networks or Bluetooth beacons transmit signals that are used by the app for positioning.


The application possibilities of location-based marketing are hardly limited. Shop owners can use location data combined with other contextual information such as weather information or purchasing history in order to submit suitable offers. Restaurants can offer coupons or call attention to current special offers. Leisure facilities have the possibility to inform (potential) visitors about opening times and events. In the event sector, location-based marketing can be used to provide live information about the course of the event or the current waiting times (for example in the catering area). The push notifications should, however, be used with care – less is often more. If the location-based services offer real added value, they enjoy a high level of acceptance among users. For marketers, the technology offers the decisive advantage that it provides detailed insights on indicators such as length of stay or return visit rate, and that it enables precise customer journey analysis. As a result, the success of campaigns can be measured not only in the online, but also in the offline world.

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