Geolocation: How Businesses Are Improving Customer Experience and Engagement

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It’s a Saturday afternoon. You are pulling into your neighborhood Trader Joe’s parking lot armed with your weekly grocery shopping list and suddenly your phone buzzes. Whole Foods just sent you a special promotional offer redeemable at a store not too far away from your location. What would you do? Would you stick to your original plan of stocking up at Trader Joe’s or would you travel a little farther to save an extra 10 percent? For anyone who’s not rolling in the dough, the answer is obvious.

Welcome to the exhilarating world of geolocation-based marketing, where your physical coordinates are your biggest trump card. In this marketing technique, businesses use a person’s exact location (received via their smartphone or wearable device) to send them highly relevant and personalized communications in real time.

Leveraging the power of geolocation, businesses across the world are witnessing a boost in their customer acquisition and retention rates. This is because geolocation allows brands to offer genuine value-addition and convenience to their patrons, which, in turn, translates into substantial enhancements in customer engagement and experience.

Take Taco Bell for example. The restaurant chain allows diners to place customized orders via its mobile app. The software then tracks the location of these customers to ensure that when they arrive at the store to pick up their orders, the food is not only ready but hot as well. Starbucks is also using geolocation to score big on customer engagement. As soon as you enter a virtual geofence erected around its store locations, the coffeehouse will send you a discount coupon to lure you in. I have personally found that very hard to ignore!

The truth is customers appreciate brands that “get” them. That said, while proximity marketing techniques like geofencing work for regular purchases, the luxury goods market is a different ball game altogether. And automaker BMW knew this all too well while launching the 7 Series model in the United Kingdom. So, instead of simply sending out messages to prospects around its dealer locations, BMW decided to spend more time understanding an individual high-earner’s profile.

According to Salesforce, 57 percent of customers are willing to trade their personal data in exchange for customized offers or deals. So, if you have access to your prospects’ age, occupation, interests, shopping history, etc., fusing that data with their location is all it takes for a marketing veteran to come up with a message so compelling it would drive even non-customers to your business—online or offline. When BMW UK used location as a context to reach its core audience, it was able to achieve an expansion rate that sat 3 percent above the industry benchmark.

There is an interesting term Google coined a couple of years ago as the digital proliferation increased across the world: micro-moments. Micro-moments are those intent-rich flashes of inspiration that make you reflexively turn to your smartphone or tablet device “to act on a need to learn something, do something, discover something, watch something, or buy something.” And when these micro-moments strike, more often than not, you are looking for a place “near” you. It could be a restaurant, a dance class, a convenience store, or any other business. Any business not making good use of geolocation to get in front of its buyers during these moments of truth is simply losing out on a rich opportunity of engaging with its customers.

Another way in which businesses are using geolocation to leave a memorable impression on their customers is through augmented reality (AR). In AR, you use technology to attach specific elements to the real, physical surroundings of a person and create a virtual world of sorts. This location-based technology is what made Pokémon Go such a global hysteria. And now, brands like L’Oreal are using AR to showcase virtual artworks to customers passing by their event sites.

While this kind of a use of AR may be more gimmicky in nature, just imagine how this technology can take product demos or maintenance instructions to the next level. For example, a furniture store could show you exactly how a new table would look inside your living room. Or a car manual app could demonstrate exactly how you can do an oil change by yourself.

In essence, geolocation has been, and will continue to, revolutionize the way companies market and engage with their customers. But it is only by joining forces with an adept technology partner – one who can equip them with the right data and tools, that businesses will be able to make the full use of geolocation’s inherent marketing potential.

1 COMMENT

  1. In the very near future, there will be a tipping point where brands and their customers will be happy to do business this way. It’s still new technology to many, but it’s only a matter of time.

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