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Proximity-marketing-strategies.png

Geofencing

The definition of geofencing in proximity marketing is defined as the ability of a company to micro-target people based on the places they go. In order to target the desired audience, creating a geometric digital radius around a company’s venue, campus, or even entire retail parks is required.

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Before 2018 marketers could send proximity marketing advertisements directly to all members of the public who entered areas that contained beacons, which meant that those with compatible devices could be served ads without having to provide consent.

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Today, geofencing works in an almost completely different way. Rather than having a defined location scattered with beacons, businesses create geometric radiuses that contain the area in which their desired target audience may be. 

For example, a sportswear brand may want to target those at a sports event and so will draw their geometric radius around the venue of the event. Patrons that attend with their devices ‘location-enabled sensors’ settings turned on are allowing their GPS to share their location data with their service provider (SP).

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BLE (Bluetooth enabled) beacons

As we just mentioned in the Geofencing section prior to 2018 marketers were able to abuse their ability to push advertisements directly to customers without consent, beacons were part of the issue. The average BLE beacon can transmit actionable BLE signals for up to 80 meters, and with many objectives for beacon campaigns being the influence of consumer purchasing it this strategy had a great low-cost solution for delivery. This is formally known as Beacon Marketing.

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Technology required:

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  • Bluetooth-enabled mobile device

  • Enough BLE beacons to cover desired proximity range

  • Data collection software and/or service

What is proximity marketing and why is it used?

Proximity marketing is a communication strategy that businesses use to maximize engagement with customers in real-time within a targeted space. Real-time comms used in proximity marketing will often consist of advertising campaigns, customer support options, as well as many other engagement strategies that adopt a ‘right place, right time’ feeling. 

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Additionally, these campaigns are delivered to audiences by utilizing their mobile devices, specific mobile uses depend on the chosen strategy.

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What are the different types of proximity marketing?

Proximity marketing contains a large number of marketing strategies that work around the location and actions of desired audiences, but what are these strategies?

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Proximity marketing strategies

  • QR (Quick Response) codes

  • WiFi (Wireless Fidelity)

  • NFC (Near Field Communication)

  • RFID (Radio-frequency identification)

  • Geofencing

  • BLE (Bluetooth Low Energy) beacons

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How does proximity marketing work?

Proximity marketing relies upon multiple technologies working together in tandem. For successful marketing to take place a multitude of steps must work together for a strategy to perform accurately. Here’s a quick overview of the technologies required when using each proximity marketing strategy along with their pros and cons.

Besides the end-users mobile device, a collection of location-based technologies (LBS) is needed to successfully utilize proximity marketing.

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Types of proximity marketing strategies 

QR Codes

Just like the traditional barcodes, QR codes contain a mix of alphanumeric values. A standard barcode contains only 20 values horizontally, whereas the 2D QR code contains up to 4000 values both vertically and horizontally.

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QR code strategies rely upon target audiences engaging with the code via their mobile phone. For example, iPhones have code scanners embedded within the standard camera, creating a seamless method of delivering messages and offers to customers.

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The ease of this strategy is fairly straightforward as it doesn’t require a lot of technology. A QR code can be quickly generated online and a destination applied for users that scan. The downside to using the QR code strategy is getting users to make the initial interaction and additional print material may be necessary. 

Technology required:

  • A customers mobile device

  • Digital displays/print-offs for QR code

 

WiFi

Businesses can utilize their free WiFi offering as a new channel for marketing directly to customers. When customers log in to free WiFi their contact information and other data can be collected which in turn creates a digital profile for the business.

Businesses can segment their WiFi users and deliver personalized communications which are highly relevant, increasing the chances of additional revenue and customer retention. When customers return to business venues it is possible for them to receive communications that influence in-the-moment purchases or engagement.

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For customers that don’t sign into the guest WiFi, access points are able to pick up the MAC address of each device within its vicinity meaning stores are able to get an accurate daily foot traffic count, over time this allows businesses to identify trends such as the busiest days and hours in a week, month, and even season.

Technology required:

  • WiFi access points

  • Customer’s mobile device

  • Data collection and segmentation tool

  • Marketing automation tool

 

RFID & NFC

RFID tags, also known as Radio-frequency identification tags, are commonly used as a method of product tracking and measuring accurate levels of stock for supply and demand over time. RFID tags work by using active and passive radio frequencies that interact with readers when in range, this means for a clothing retailer any products taken into a changing room will be identifiable.

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NFC or Near-field Communication has evolved from radio frequency identification (RFID) technology and operates as one-half of a wireless link. You could have just used NFC yourself by making a purchase with your mobile device.

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As written in the paper, the ‘Application of NFC technology in proximity marketing’ by Lubica Gajanova & Jana Kliestikova of the University of Zilina – “Proximity marketing is a tool for creating a personal relationship between a customer and a vendor at the time of a customer’s physical purchase at the store through modern, personalized, timely, and relevant communication.”

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NFC tag uses don’t stop at the point of sale system, in fact, the knowledge gained from each purchase and interaction further improves the insights businesses have, meaning over time, customer segmentation and messaging become more focussed.

Technology required:

  • Consumer mobile devices

  • NFC / RFID tags

  • POS (Point of Sales) system

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