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Geo-fencing vs Geo-targeting: What’s the Difference?

With all of the tracking capabilities available in today’s mobile phones, computers, televisions and intelligent personal assistants, some people fear that the surveillance state of George Orwell’s classic 1984 has become a reality. It has, kind of. But before you go screaming into the night and building a makeshift shack nestled deeply in the forest away from cell towers, give us a chance to sell you on the vast benefits of this and how it applies to geo-location marketing.

Powered by GPS coordinates, IP addresses, triangulation to cell phone towers and wifi networks, geo-location marketing collects data from a person’s physical location. Ad networks then use this information to serve ads for local businesses to potential customers nearby. Even if a user turn off GPS capabilities on their mobile device, “they” will still find the user. (They = Big Brother) Smartphones and mobile devices are constantly trying to figure out where they are in the world. To do so, they are continually pinging cell towers and wifi networks to gather data.

Once a device figures out where it is, it shares its location with all different geographically driven apps – like weather widgets, restaurant directories and retail guides. This helps the ad networks more accurately pinpoint your location, and effectively advertise to consumers based on their location. Super cool, right?

There are two different types of geo-location marketing for us to explore: geo-fencing and geo-targeting.

The Virtual Turf of Geo-fencing

Geo-fencing creates a hyper-specific virtual bubble around a location, and constantly updates while a person is on the move. Ads inside of the geo-fenced bubble can be viewed across multiple devices as users browse the web. Geo-fencing takes full advantage of the collected location data by displaying ads to potential customers inside of the geofence radius to notify them of local deals.

Let’s say you travel to Orlando for a marketing conference. While you’re idly listening to keynote speeches about “corporate synergy,” an eye-catching ad pops up on your laptop for a concert later that night, which just so happens to be near the same venue as your conference. After you click the ad, those ads follow you around the web while you’re at the conference, appearing multiple times in multiple places reminding you to make post-conference plans.

The Geo-targeting Barometer

Geo-targeting is similar to geo-fencing, but it only delivers ads to people who meet certain criteria (like demographics, interests and behaviors) within a specific radius. As the usage of mobile devices continues to grow, the accuracy and availability of geo-targeting data will thrive.

Using the same example as before, during your Orlando marketing conference an ad pops up in your Facebook feed for a pay-per-view boxing match airing later that night at a sports bar just a short drive away. Because you’re a male, in your 30’s and recently liked images of Mike Tyson’s face tattoo, geo-targeting ad networks assume you would probably be interested in seeing this fight. The conference-goer on your right did not see that ad, because he is into yoga and not interested in boxing. But the conference-goer on your left did see the same ad, because she follows Floyd Mayweather on Instagram.

So without doing any manual research of your own, you now have two great options for how to spend the evening. Live music because it’s convenient for you and the boxing match because it’s interesting for you. And marketers don’t have to waste their money reaching other conference-goers with different interests. Savvy marketing!

Which works better for your audience?

Geo-fencing and geo-targeting can be used across devices. This includes mobile, tablet and desktop. (Does anyone still have a desktop?) Walkmans, beepers and Tamagotchis are safe from ad networks.

In terms of marketing, geo-location marketing is most effective after you figure out who your target customer is. If your business is looking to appeal to the masses (customers of all ages and interests), then the wide scope and broad appeal of geo-fencing will likely work in your favor. For example, restaurants usually have a broad appeal since everyone has grown quite accustomed to eating nowadays. If you are seeking a more controlled consumer base of a specific demographic, then geo-targeting is better suited for your advertising goals. Let’s be honest, a steakhouse would be wasting money advertising to vegetarians. Geo-location technology allows businesses to tailor information and customize the user experience.

Implementing geo-location marketing for your brand

So what can you do with all this newfound information, and how can you convert it to marketing? Conversion is critical, which is why it’s crucial to find the right mobile marketing platform that reinforces your online campaigns. One of the easiest to use for SMBs are Google’s Adwords platform, which allows you to get pretty specific with your geo-targeting. Facebook is another powerful network, allowing you to build geo-targeted audiences with lots of moving parts. For businesses that have larger budgets to play with, or larger areas to target, some of the more popular platforms include Blis, Foursquare, Verse, Placed and PlaceIQ. Again, there are a lot of moving parts within geo-location marketing, and you want to be sure you’re utilizing the right tools. This is all about customer engagement and enhanced user experience, amiright? Yep!

The main issue preventing geo-location marketing from exploding is the privacy concern. Despite geo-location marketing proven to be 20 times more effective than standard display ads, some businesses are still on the fence about the benefits. Another limitation is where the ads are served. You’ll want to make sure that your audience is engaged with the types of sites and apps that are on your geo-targeting platform. This is why advertising on Facebook is so effective, because pretty much everyone (even your mom) uses Facebook.

As more companies utilize location-based advertising, we can further explore brand awareness and consumer purchase intent. Sure, Big Brother technology can feel like an affront to our privacy and our peace of mind. But, when used effectively, geo-location marketing is win-win for marketers and consumers. Marketers don’t waste valuable ad dollars and you don’t have to see irrelevant ads. As long as marketers are honest with consumers about their mind-controlling-mobile-device-infiltrating geo-location technology, we should avoid George Orwell’s dystopian future. But only time will tell!

Laughing Samurai

Laughing Samurai

We're a digital marketing agency. We do silly things like branding, web design and video.

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