Location & Beacon Marketing: What are they?

Marketing Trends are Ever Changing

Those in marketing know that this industry is one that changes more often than gas prices. We love it because it keeps us sharp, on our toes, and technologically savvy. It’s a never ending journey, it seems!

One of the most recent trends that started in 2015 and that will most likely be one to look out for is Location Based Marketing.

So what the heck is Location-Based Marketing?

This technological/informational age we’re in is providing us with new and exciting innovations constantly. 87% of internet users now have smartphones¹ and that little device in your pocket is repeatedly updated and replaced, becoming more ingrained into your life with every passing minute.

Not only do cell phones allow us to connect with our friends and family, they allow us to connect with our favourite brands, and conversely, allows our favourite brands to connect with us.

The relatively new innovation of location-based marketing allows businesses to notify people on their cellphones about promotions for their products. But that’s not all (of course). The thing that makes location-based marketing so special is that it notifies the potential customer of this promotion when they are nearby the business’ physical location. Using location tracking on cell phones, an app, and a little tool known as a beacon, companies can push notifications to passing consumers in an attempt to make them enter their store and purchase a product. Even better for the company is when the customer is already in their store and using their cell phone to look for deals. This type of marketing is highly convertible.

For the sake of an example let’s say that a store in a mall near you is using location-based marketing. That store may want to alert you of specials on their products, and because you’re either already in their store or passing by, you’re primed to make an action on that deal. The user has the app, location services feature on your cell phone is turned on, they have a beacon in place, you’ve shown interest in their product, you get a notification for a deal, you purchase an item. That’s a lot of steps to take to ensure that a conversion is reached. All those steps can be a nuisance, and that’s what brings us to some of the problems we detect with beacons.

Problems with Location Based Marketing

We’d say that beacons make sharing your deals with consumers relatively easy! Except that it’s not so simple. The entire process of sending notifications to users can only begin when the person has downloaded an app that promotes deals for your business.

Another issue with location-based marketing revolves around — you guessed it — privacy. Location based marketing requires certain information from users in order to work properly, along with their real-time location (obviously). This raises eyebrows with some groups, and there are laws that differentiate between countries based on location services.

Best Practices with Location Based Marketing

If you’re absolutely set on using beacons in your marketing strategy, then you should make sure you adhere to some beacon-best-practices. PbD –Privacy by design means that you design your products (be they physical or software/web-based) with privacy in mind. When you develop your framework, prioritize the privacy and safety of your users first.³ Contracts should be drafted and extremely detailed to meet the law requirements in each country and jurisdiction. See this article on Smashing Magazine for more details on location-based marketing best practices.

There you have it

The LBMA (Location Based Marketing Association) claims that the location and beacon based market will be valued at $43.3 billion dollars in 2019.² Needless to say, that’s a huge projection, and it may or may not hold true. To assess whether or not their prediction will come to fruition, we need to address the pros and cons of location and beacon-based marketing.

While there are clear benefits to having location and beacon-based marketing, they also come with drawbacks. Make sure to keep an open ear to any news you may hear about the development of these strategies! And contact us on Facebook or Twitter if you’d like to chat about it.

Sources: Global Web Index¹, SMB Retail²2, Smashing Magazine³, The LBMA