May 30, 2023 / 12 min read

Geofencing Marketing: Using Location Data to Tailor Advertising


There has never been a better time to capitalize on mobile marketing. As of this year, 86% of the global population uses a smartphone—a whopping 6.92 billion people. In the United States alone, Americans spend an average of nearly five and half hours per day on their mobile devices. 

Advertisers poured $336 billion into mobile ads last year, feeding a booming industry and buying access to an unprecedented level of consumer targeting. To realize the potential impact of mobile ads, siphoning location data from individual devices and their proximity to points of interest (POI) in the outside world is an essential requirement. In fact, location data underpins the entire mobile marketing machine. 

For brands who are looking to reach highly targeted audiences on a global scale, we’ll explore different forms of mobile advertising and the role location data plays in making them all possible. In particular, we’ll focus on the location data-driven mechanisms of geofencing marketing, covering its benefits and use cases for mobile advertisers.

What is geofencing marketing?

Mobile advertising offers targeting on a granular level by displaying advertisements on a consumer’s smartphone or other personal devices. Operating on data extracted from a consumer’s mobile device, this form of marketing allows advertisers to connect with their target audience based on signals that include a consumer’s behavior and geographic location. This individualized targeting ensures that advertisers are reaching the right people and optimizing their ad spend.

There are myriad ways to reach consumers on their mobile devices, including display, interstitial, native, and video ads. Depending on the app, consumers may also be served in-app advertisements. However, location-driven advertising takes mobile ad impact a step further. Geospatial insights enable companies to deploy geotargeting, geofencing, and even geo-conquesting campaigns that can attract new customers and boost return on ad spend (ROAS). 

Geotargeting allows advertisers to reach consumers based on the location of their mobile device. This targeting occurs on a high level, such as the device’s city, zip code, or IP address. It is a more general approach to location-based advertising that helps advertisers target consumers within a specific market. It’s important to understand that geotargeting and geofencing are not the same.

Geofencing advertising is an approach to mobile marketing that is confined to spatial boundaries in the physical world, placing an invisible perimeter around a specific point of interest (POI) and serving ads on devices within it. Similarly, geo-conquesting uses spatial boundaries around a competitor’s location to target devices—which belong to customers—within a given perimeter. 

In the case of geofencing marketing, POI data is critical. POI is a specific category of location data that reveals information about physical places, including stores, restaurants, and landmarks. This helps advertisers build footprints for their target audience, identifying POI that are relevant to their brand or product and running ad campaigns nearby. 

How geofencing benefits advertisers and brands

Advertisers benefit from geofencing by delivering messages to the consumers they want to reach, based on that consumer’s proximity to a physical place. For example, a CPG brand could use geofencing to serve ads to shoppers in a grocery store. This ensures that ad spend is being dedicated to consumers who have a greater likelihood to convert. 

Given the current state of the economy, some advertisers may need to run campaigns to offload excess inventory. A fashion retailer may decide to run a geofencing campaign within the spatial boundaries of their store, giving a discount or limited offer to customers in real-time and helping to sell the overstocked product. 

Additionally, geofencing can help advertisers outperform competitors by way of geo-conquesting, which applies the principles of geofencing to a competitor’s physical location. Through geo-conquesting, brands can serve ads to potential customers whose devices are seen in proximity to a competitor’s space in hopes of winning their business with tantalizing promotions. 

How to make the most of geofencing

If Popeyes Louisiana Chicken, an American quick-service restaurant (QSR) chain, decided to run a series of geofencing advertising campaigns in southeast Asia, gathering location intelligence would be an essential first step. This includes POI that its target customers might frequent—for example, a shopping center in Jakarta, Indonesia—as well as competing QSR locations in the larger region. 

However, knowing where these complementary and competing POI are located would not complete the puzzle for Popeyes. The QSR chain would also be interested in evaluating activity around these POIs over time, helping them understand which geofenced areas to prioritize for ad spend.

By gathering this location intelligence, Popeyes increases the likelihood that their geofencing advertising campaign will yield the desired results—generating new or repeat customers, and even luring customers away from their competitors. 

Let dataplor unlock tailored data and advertising 

While geofencing appears at the surface to be a no-brainer marketing strategy, its success hinges on the quality of the location data informing it. This is especially true for international markets, where POI data is notoriously inaccurate, and for companies who rely on open source data, which is susceptible to errors and outdated information.

Circling back to Popeyes’ plans to run geofencing campaigns in southeast Asia, low-quality location data could result in thousands, if not millions, of dollars in wasted ad spend. For example, If Popeyes thinks it is targeting a series of American retail brands who share common customers with the QSR chain, but those physical retail stores shut down months ago, Popeyes is paying a hefty price tag to target data that doesn’t exist.

Fortunately, there is a solution for brands who want to shore up their investment in geofencing and mobile marketing. dataplor serves as a global location intelligence partner, using polygons that are more in tune with client demand and tailored to customer needs. These polygons are drawn using dataplor’s proprietary AI and machine learning approach, making them both scalable and competitively priced.

Additionally, dataplor offers the most accurate international POI data on the market, positioning the platform as the only industry player that can provide truly global polygons for geofencing and geo-conquesting campaigns.

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