How To Grow Your Small Business Using Proximity or Location-Based Marketing

In today’s ever-evolving digital landscape, the need for meaningful experiences has significantly increased.

Over the years, we’ve seen brands craft more personalized or relatable campaigns to reach and convert their target audience effectively.

We’ve encountered landing pages with special discounts, in-app recommendations, and customized emails. 

Among these many solutions is proximity or location-based marketing.

This marketing model encompasses various strategies that offer excellent opportunities, especially for small businesses, to create campaigns that appeal effectively to their target audience.

Join us as we explore proximity or location-based marketing strategies.

In this guide, we’ll help you learn all the different types of tools and techniques, as well as the benefits of using them. Read below for more. 

Understanding Proximity or Location-Based Marketing

Proximity or location-based marketing refers to various strategies that use a person’s geographic position to reach and convert them.

Brands use this technique to deliver personalized content, promotions, and other unique offerings.

These models use multiple tools and services to help brands reach their customer base and reap many benefits.

Some of these technologies include global positioning systems (GPS), radio-frequency identification (RFID), Wi-Fi, and Bluetooth beacons.

Today, many types of geo-related marketing techniques are available for small businesses.

We’re listing below all the best location-based strategies that can help boost reach, engagement, and traffic.

Geo-targeting

This strategy targets potential customers based on their geographic locations, buying behaviors, and other specific criteria.

It uses various elements and services, like IP addresses and third-party platforms, that allow brands to send relevant messages based on their target audience’s specific area.

Geo-targeting is an excellent technique for increasing brand awareness through relatable content.

It’s also ideal for promoting local events or special in-store offerings. One of the best examples of this model is when retail brands offer discounts to people near a specific branch. 

Geo-fencing

Similar to geo-targeting, geo-fencing targets potential customers based on their specific areas.

The key difference is that this model uses boundaries or “fences” around target locations through GPS and RFID technology. 

When potential customers enter these fences, they can receive notifications, like discounts and other special offerings, from brands.

For instance, restaurants and cafes can send messages to potential customers walking past their establishments. 

Geo-fencing is also best for promoting in-store offerings and local events. It’s also an excellent strategy for increasing brand awareness to potential customers nearby. 

Beaconing

Beaconing is a proximity-based strategy that leverages a Bluetooth device as a “beacon” to send relevant messages to target audiences close by.

When their devices, like smartphones or tablets, come within proximity of a beacon, you can send them relevant messages, including special promotions or event invitations. 

This strategy is excellent for engaging with potential customers who are currently in-store.

For instance, sending them ads about discounts and bundles while they’re browsing through your products will help encourage them to purchase.

Aside from that, you can use this model to provide essential information like product reviews or recommendations to boost their buying process. 

Geo-conquesting

Geo-conquesting is a more aggressive location-based marketing that uses competitor locations to promote a rival offering to their customers.

The goal is to attract these customers away from your competitors by offering them discounts and other incentives.

Before, the biggest example of geo-conquesting was when brands put up posters or billboards near their competitors.

However, with the advent of digital marketing, brands can now target potential customers through their smart devices.

Through GPS technology, brands can send relevant messages to their target audience who are in proximity of their competitors. 

Why Use Proximity Or Location-Based Marketing

As mentioned, these marketing strategies can help businesses in many ways. We’re listing below some of the known benefits of using them.

Understand Your Audiences Better

This marketing model allows businesses to acquire valuable data that will help them understand their customers at a deeper level, which is crucial if they want to craft meaningful experiences for them. 

Through location-based marketing, brands can understand their target audience based on age, behavior, and online engagement.

Using such details will help marketers develop effective campaigns that increase the likelihood of converting their potential customers. 

Boost Your Customer Loyalty

Location-based marketing allows brands to showcase themselves as a caring business in the market.

Through such solutions, you can create content, promotions, and experiences that feel personalized to your target audience.

If you continue to develop meaningful campaigns, you connect better with your customers and boost their loyalty.

Moreover, using these strategies will help you offer timely promotions, discounts, and other special deals.

Customers can view this as an incentive for visiting your store or purchasing in the past, making them more inclined to buy again. 

Achieve Low-cost Marketing

The best part about this model is that many tools and services that provide proximity or location-based solutions are significantly cheaper than other marketing methods.

Some of them are even available for free, which is highly beneficial for small businesses looking for effective ways to market their brands with little to no cost. 

Gain Competitive Advantage

Aside from low-cost solutions, location-based marketing can help small businesses compete with larger players in their field.

Providing meaningful experiences through these strategies will allow you to boost your discovery and engagement, regardless of your size.

Because of that, you attract more local customers and elevate more sales even while competing with bigger competitors in your industry. 

Identify A New Market

It may be too early for some small businesses to expand their venture.

However, these marketing strategies will help you determine expansion opportunities that you may want to consider in the future.

Understanding preferences and behaviors in different locations will help you decide where to establish new stores or extend your offerings.

Some Disadvantages To Keep in Mind

While proximity or location-based marketing strategies provide various benefits to small businesses, they have certain limitations worth considering. 

For one, this model often has opt-in requirements where users must give certain online services access to those data.

Targeting them through such solutions will only be possible with their permission.

Additionally, relying too much on this model is not ideal because of ad fatigue.

That happens when you overuse this strategy and send too many notifications or messages to your target audience.

Doing so will urge them to opt out because your campaigns will become too intrusive or annoying. 

Your campaign’s effectiveness could also be affected by a virtual private network (VPN) on your target audience’s device.

A VPN is a third-party program that masks or changes a person’s location.

If potential customers are using VPNs, they will become more challenging to reach because their location details are likely inaccurate.

Moreover, it’s vital to know that targeting a specific geographical area without a plan doesn’t guarantee results.

You must always segment and understand your audience correctly to make your campaigns effective.

Expand Your Reach

All proximity or location-based strategies mentioned above are highly beneficial to small businesses, allowing them to connect better with their target audience through meaningful and personalized experiences.

However, you can only get such benefits from using this model correctly. 

Use the data you acquire responsibly and respect your target audience’s privacy when leveraging any proximity or location-based technique.

Plus, you must always provide relevant content or offerings to ensure that you get the most out of this powerful tool.

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