In Modern Marketing, It’s All About Location, Location, Location
With the success of that program test, Burger King plans to roll out the program to other cities with excessive traffic congestion.
Geoconquesting: Geoconquesting acts in many ways as a “reverse geofence.” Rather than establishing a digital barrier around the company’s own stores, it geofences select competitors’ businesses. The idea is that the prospect is already looking to make a purchase, so the right compelling offer might entice him to leave the competitor and come into your store.
Here again, Burger King had huge success with this type of campaign. Some of the fast food chain’s locations offered Whoppers for hugely discounted prices to consumers who were within 600 feet of McDonald’s drive-through entrances. They typically had one hour to come into the nearest Burger King to redeem the offer before it was discontinued.
The program, which ran on the Tillster platform, was extremely successful, according to Khan.
Millions of customers downloaded the app in the first few days after the launch, which propelled it briefly to the top spot in Apple’s App Store and Google Play. Daily mobile orders per store grew by a factor of seven. And, outside of the demonstrable numbers, the promotion resulted in plenty of free mentions for Burger King on social media and other communications channels.
MAXIMIZING LOCATION-BASED BENEFITS
To get the most out location-based marketing, it’s not enough to merely track customer movements. Neiman recommends combining location information with segmentation and other customer data to improve the targeting of the offers.
“You can’t be pinging the phone with offers all of the time,” Neiman cautions. “You need to be more selective; if you’re too overt, customers are likely to unsubscribe.”
A coffee shop, for example, can probably send offers daily or weekly, while other establishments might be better served doing so less frequently, she says, pointing out that customers might stop in to the same coffee shop every day for their morning jolt but aren’t likely to go to the same restaurant every day for lunch.
It also pays to be able to track campaign success. If, for example, a new customer redeems an initial offer and doesn’t return, the establishment could attempt to increase the offer, as long as the customer retention cost doesn’t outweigh the benefit to the business.
Nieman also cautions that location-based marketing needs to be used selectively. You don’t want to send an offer to a customer who is coming to you anyway, she says, noting that a business gains little by offering 20 percent off when the customer was already going to buy the item for full price.
Businesses engaging consumers with location-based marketing campaigns also have to be aware of growing privacy concerns and tightening regulations around customer data.
While location-based data is readily available right now, companies’ ability to use it could be facing some very strong headwinds in the not-too-distant future, according to Khan. Newer privacy laws, like the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), have placed limits on how companies collect consumer information and what they can do with it. There is still some disagreement as to whether a person’s location could be considered protected personal information, but businesses should prepare for that possibility just in case, experts advise.
Beyond the shifting privacy landscape, Khan and other experts expect location-based marketing to become more intertwined with other marketing techniques and technologies.
Chief among them will be 5G mobile networks, which are expected to explode in 2020. Because 5G can carry much greater volumes of information at much greater speeds and with far less latency, it will greatly expand the capabilities of location-based marketing, according to Khan. Companies could, for example, incorporate multimedia into location-based campaigns.
Connected cars will be a big area of growth for location-based marketing as well, Khan predicts.
Nieman expects marketers to continue refining their segmenting and targeting as well as their use of other customer data to continue to refine their location- based marketing efforts.
But in the end, location-based marketing shares one thing in common with all other forms of digital marketing: If the promotions are too generic or too frequent, customers will see them not as valuable offers but as a nuisance. Once that happens, they will be annoyed, will disengage, and could even be the source of some negative word of mouth.
Phillip Britt is a freelance writer based in the Chicago area. He can be reached at spenterprises@wowway.