By Virginia Automobile Dealers Association
Great marketing is the art of selling the right thing at the right time to the right person. For example, suppose it’s raining outside. You make a run from your car to the grocery store’s main entrance, wishing you’d thought to grab the umbrella sitting by your front door, and inside the store’s main entrance is an attractive display of colorful, practical and competitively priced umbrellas, thoughtfully positioned so that you cannot miss it. How likely are you to pick up one of those umbrellas? Depending on how hard it is raining, whether you have a waterproof coat and hat on, and your budget, the chances are good that you will end up buying an umbrella in addition to the milk and the tortillas you intended to get.
Time and place are both important aspects of this kind of marketing. That same umbrella display, placed well away from the front entrance, would not be anywhere near as effective. It also wouldn’t be effective once the rain stopped. Success depends on recognizing that an on-going rainstorm presents a business opportunity, and then acting on it in a way that won’t offend customers.
Geo-targeting provides essentially the same marketing technique by using location data from, say, someone’s cellphone. Consider some possible cellphone applications, all of which would involve cellphones:
- A potential customer goes to a car dealership and gets a discount offer either for that dealership or for the competitor across the street.
- A woman goes to the mall. While she is walking toward the shoe department, she starts receiving information about her favorite brand of shoes. A half-hour later, after she purchases a pair of boots, the cellphone reminds her of her favorite restaurant at the same mall and lets her know takeout is 20% off.
The technology is not that different from browsing the Crate & Barrel website from your computer and (thanks to cookies) suddenly being shown ads with a selection of the dinner plates you were browsing. When executed well, geo-targeting is a great technique for driving foot traffic, especially when you combine it with some knowledge about the people receiving your messages. For example, Denny’s repeat customers received two targeted mobile ad campaigns: “Build Your Own Skillet” increased in-store visits 11.6% and “Build Your Own French Toast” increased in-store visits 34%. Customers were not necessarily close to the restaurants when they received the offer, but the campaigns were still effective because they targeted people who had been to the restaurant.
As with any marketing technique, it’s possible to do geo-targeting wrong. Consider the example above of a woman who was shopping for shoes. Is she going to appreciate the fact that someone knows where she buys shoes and when she’s likely to want takeout? Or is she going to feel like a marketing department is stalking her? Equally, it isn’t an infallible technique. If someone eats at a restaurant once and doesn’t ever go back, but the restaurant keeps sending text messages as if the customer eats at the restaurant all the time, is the customer going to be happy or irritated about receiving all these text messages?
Irrelevant or overly invasive marketing cannot possibly be effective.
What can you do to implement geo-targeting effectively on mobile devices?
- Geo-marketing involves a trade: giving away a location in exchange for something of value. Never forget that. The potential customer’s part of the deal is to tell you where they are, and your part of the deal is to make sure they don’t regret it. As a result, you need to pay attention to the value you are offering. Potential customers are more likely to trust you and to appreciate the ads you send them if they can see that they are getting something in return: a discount at the point of purchase is one example, and loyalty points are another.
- Be careful how much information you give people about what you know. For example, it’s possible to figure out if someone in a household is likely to be pregnant. You don’t want to send an ad for diapers and baby shampoo before the prospective mother has had a chance to tell her partner about the happy event. Put yourself in the place of the person receiving the ad. Would you be spooked or happy? It’s going to spook them if it would spook you.
- Look at venues and decide what people who go there are going to need at different times. For example, you can consider airports, malls, stadiums and universities. At an airport on a weekday, you will probably have business travelers who are looking for a nice meal. Weekends probably have passengers who are just looking for something casual and fast. Malls are going to have a different crowd at Christmas during the evening than they will in the early mornings when people use the mall as a free, warm, safe place to get some exercise. A stadium may host sporting events or concerts; each group will have different needs and wants. A university has plenty of young students, many of whom are between 18 and 21.
- Exclude venues when it makes sense to do so. If there’s no game between two rival schools, for example, you don’t want to be hawking fast food at the concession stands to the people who usually buy tickets. Not only does it make sense to think about the timing for your ads, it is also cheaper than a blanket approach. Don’t pay for what you don’t need.
- If you are targeting a specific location, put a distance radius and a time radius around it. People who are too far away aren’t good targets, and neither are people who are busy doing something else, like spending the evening at home with their family.
- Pay attention to whether a location is low-performing or high-performing. Places with lots of people (think major cities like New York) have the potential to reach so many people that you can afford to charge less for ads. Less populated areas that have a lower success rate should have more expensive ads to offset the difference in population density.
- Include location terms that are likely to show up in the search strings that people enter. Appropriate location terms are the area code, the name of a community, landmarks, popular venues, tourist attractions, well-known street names, ZIP codes, and anything else you can think of that someone might use to find something specific, like a gym or a coffee shop.
- Geography can tell you a lot about demographics. A mall in a city section with a large Hispanic population is going to look different from a mall with a different population. The ads should differ, too.
- Search history can be very revealing. Suppose someone starts looking at travel agencies and specific countries. Or suppose that you find out someone prefers to shop at Amazon, Nordstrom and Walgreens. You can figure out a lot about a person by where they spend their time and their money. You can also figure out a lot by the questions they start Googling.
- Make location-specific landing pages for potential customers. That way, you can tailor the page to their needs more effectively.
- Pay attention to what’s going on. This advice is equivalent to the example above, about the umbrellas next to the front entrance. Look at events, holidays and weather. Plan your ads accordingly.
Geo-targeting is still relatively new, which means there’s plenty of room for doing it wrong. But if you are respectful about how you use the information you have about customers, and always make sure you give them something valuable in exchange, there’s a good chance you can make a success of it.
This story appears in the 2019 Issue 4 of the Virginia Auto Dealer Magazine.
