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Tips and Tools for Location-Based Marketing

A primer on personalizing and targeting your messages by location

Directing customers to a nearby physical location is getting more sophisticated, thanks to mobile devices and emerging technologies known to marketers as location-based services, or simply LBS. There's no need to get sophisticated in your approach to location-based marketing, however. The technology may be new, but the concept has been around ever since the first phone book listed only the businesses in a particular town or region.

Location-based marketing includes a diverse array of tactics--from simple local advertising to more complex location detection using GPS and triangulation technology. You can use location-based marketing to:

  • Deliver a coupon or a message to a mobile phone
  • Display local ads to a person visiting a website from a specific location
  • Deliver detailed product information when someone is standing in front of the product
  • Offer incentives for location-based activities such as visiting a store multiple times
  • Make it easy to find nearby things such as stores, ATM's or even Coke machines
  • Provide event, meet-up and social opportunities based on a physical location
  • Share location-based information with others in a social network


There are basically only four different types of location-based marketing tactics that allow you to deliver location-relevant messages:

  1. You can detect someone's location using the GPS or triangulation technology built into a mobile device. You can also detect a more general location when someone logs on to a local internet connection using a computer or laptop. For example, a customer who has opted-in to a location-based coupon service is walking by a store and instantly receives a text-message with a coupon that says, "Hi John, come on in and show this text-message for 25 percent off any in-stock item."
  2. You can request someone's location by asking for an address, city, zip code, or other location information when people interact with your website or a search engine. You can also ask people to select a location from a map or a list of locations. For example, a customer on a mobile phone goes to a restaurant chain's website and the website asks for a zip code in order to display special offers, maps, and contact information from the nearest location.
  3. You can infer someone's location when someone searches using location-dependent search terms like "Mexican Restaurant Denver." You can also infer location when you have location information in your customer database. For example, someone visits a website for the first time and provides location information, and then automatically sees location-relevant information on every repeat visit to the website.
  4. You can invite interaction by placing interactive messages at points of interest. You can enable interaction with scan-able barcodes, Bluetooth and even keywords that are only known if you're standing in a specific place. For example, a customer in a retail store uses her mobile phone to text a keyword listed on a product display to receive a link to a mobile website explaining the most current local incentives on the product featured in the display.

All of the aforementioned tactics are capable of delivering valuable and relevant marketing messages, so choosing one or the other depends more on the nature of your customers than the nature of your business strategy. The most important thing to keep in mind is that proximity isn't necessarily an indication of purchase intent. Your location-based marketing will be much more effective if your tactics can also identify impulsive shoppers versus those who are just researching. That way, you can deliver a "buy-it-now" message to impulsive shoppers or a "learn more, buy later" message to researching shoppers.

Also remember that the more invasive your tactics, the more likely you'll need to build a permission-based strategy. If your plans include interrupting people with messages when they happen to be passively in the vicinity of a buying opportunity, it's a good idea to ask your customers to opt-in to receiving those types of messages so they aren't annoyed when the messages come and they aren't ready to buy. Even if your plans involve responding to customer-initiated activity, it's a good idea to include opt-in messaging at some point in the process.

Location-based marketing technology is one of my favorite marketing trends, because it has such great potential for improving the way small businesses can advertise, communicate and stay competitive in their local communities. According to Forrester Research, the number of in-store sales influenced by web and online research accounted for 42 percent of total retail sales in 2009, and that number is expected to grow to 53 percent by 2014. Make sure your local business has a plan for driving all those online researchers to your local business.
 

John Arnold is a Boulder, Colo.- based consultant, speaker and trainer specializing in marketing advice for small businesses. He is the author of three marketing books in the 'For Dummies' series including Web Marketing All-In-One Desk Reference and Mobile Marketing for Dummies. Follow him on Twitter: @ArnoldMarketing

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