What Is Location-Based Marketing?

And Why Should Small Businesses Care?

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Location-based marketing involves online and offline tactics designed to help businesses plan and implement marketing activities based on consumers’ geographic location. At the heart of location-based-marketing is the use of consumer data to display relevant brand messaging to a highly-targeted audience.

For instance, let’s say you run a small business that operates within an intensely-competitive market.

It might benefit you to communicate with customers that are considering your competition instead of you. In this scenario, you could use a location-based marketing tactic like geo-conquesting to send discount offers to consumers who enter a designated physical area near your competitors’ stores. 

In fact, geo-conquesting was used by Whole Foods to grow their post-click conversion rates on mobile advertisements. Whole Foods sent deals to consumers’ mobile devices when they got close to a competitor to lure them away. This campaign led to a 4.69 percent conversion rate which was three times the national average.

Location-based marketing isn’t just reserved for large corporations, small businesses can use this powerful marketing strategy to drive more targeted customers to their store.

What Is Location-Based Marketing?

Location-based marketing, also known as geomarketing, is not a new concept.

Businesses have always understood the value of marketing to people based on their location. This is why many brick-and-mortar businesses still send direct mailers, and it’s why you see people wearing Statue of Liberty costumes on the roadside during tax season.

Simply put—there is immense marketing value in knowing an audience’s location.

Today’s geomarketing activities are more advanced than some of the traditional strategies. For instance, using beacon technology a retail store could send a targeted message to someone walking by their business. The technology can also detect when that customer enters the store, and it can deliver additional messages to entice specific product purchases and speed up the checkout process. 

The growth of mobile integration, big data management, and consumer’s trust in technology have all played a part in making location-based marketing more efficient.

Why Should Small Businesses Use Location-Based Marketing?

Location-based marketing has become increasingly popular and more affordable—making it a valuable tool for businesses large and small. The main reasons small businesses need to consider using geomarketing are:

It helps generate more business: The goal of any marketing campaign should be to attract more customers. Location-based marketing can help you do that by getting your business in front of consumers when they are most interested in purchasing your product or service. For instance, if you are a local fitness instructor, your clientele are people within your city. Therefore, you can create Facebook advertisements that are limited to people within your specific zip code—which increases the likelihood of reaching potential leads.

Makes segmentation easier: Segmentation is a marketing activity that involves grouping customers based on shared interests, activities, or attributes. Location is one of the best ways to segment a group. If you can determine where someone is at a given moment, you can create a message that is tailored to that specific location—making it more relevant to that consumer.

Provides a better return: Good marketers work smarter, not harder. Therefore, you should always strive to increase your return-on-investment with any marketing activities. Collecting, analyzing, and using location data can help you generate more engagement on your promotions and improve the return on your advertising dollars.

Location-Based Marketing Ideas for Small Businesses

Now that you understand what geomarketing is and why it’s important, how can you start using it to market your small business?

Optimize for Local SEO: As a small business, local SEO can greatly improve your probability of attracting new business. Local SEO typically refers to the organic traffic generated from your Google My Business listing for consumers searching for surrounding businesses that offer a particular good or service.

You can improve your local SEO by creating location-specific content on your website, encouraging five-star reviews from your customers, and optimizing your Google My Business listing. The more organic local customers you can attract, the less you need to spend paying for customers—so be willing to see the long-term value of investing in SEO.

Geotarget with PPC: Pay-per-click (PPC) advertising is a powerful tool for small businesses. However, if you’re not taking advantage of the location-specific data and segmentation options with your PPC campaigns, you are missing out on a huge opportunity. 

Geotargeting lets you filter the audience that has access to your PPC advertisements. This helps you target a specific group based on their location. Thus, helping to avoid wasted clicks from people outside your targeted area. 

Use Location Tags: Social sites are known for their use of tags. Tagging posts help social platforms like Facebook, Twitter, and Instagram filter their user-generated-content. One of the tags they use is known as a location tag which uses your mobile GPS to pinpoint where an image or post occurred.

If you want to increase the visibility of your posts, use location tags. This will increase the probability of your post gaining organic impressions when users search for more photos based on location.

Be Active in Your Community: Technology makes it easier for you to target consumers by location, but there are plenty of location-based marketing strategies that don’t require technology like activism. If you are a small business, one of the best ways to grow your brand in a specific area is to leave a footprint through community activities and social awareness.

Try hosting a fundraiser for a local nonprofit or sponsoring an event in your community. The more active your brand is in a specific location, the more aware of you that audience will become.

Get Started With Location-Based Marketing

If you’re looking to take a more strategic approach to your marketing communications plan, then you should consider integrating location-based marketing tactics. A marketing strategy that emphasizes location data will likely yield a better return than a sweeping communications strategy.  

Your business doesn’t need to jump right into a full-fledged geofencing campaign—rather, try starting with collecting and analyzing the location data on your current customer base. If nothing else, this will shed some light into where you may want to invest your marketing resources.

After all, great marketing is about getting in front of the right people at the right time. If you can’t pinpoint where your target audience is, then you’ll have a hard time getting your message in front of the right people at the right time.