IP, or Internet Protocol, addresses are a fundamental building block of the digital world. From smartphones to laptops, all electronic devices that access the internet or connect with other networks can do so with their unique IP address.
The power of these individual identifiers, however, goes well beyond their connective capabilities. With today’s digitized services, businesses can enrich their audience insights by unfolding IP address information.
Seeing as it is directly and uniquely tied to a digital device, an IP address serves as an identifier – or locator – of the device in question.
That is precisely why many businesses use IP tracking to gather data on individuals and customers and how to reach them better.
The information can lead to bountiful advancements in marketing, sales, and overall strategy improvement.
If you’re thinking about using IP tracking to advance your business, you’re probably wondering about the potential downsides of the technology.
To help you get a better grasp of both sides of the coin, we’ve compiled a pros-and-cons list of IP tracking and what it means for the development of your business.
Pros of IP Tracking
The most basic feature of IP addresses – and trackers – is deciphering the location of a connected device.
That helps businesses understand their online audiences and branch reach better, which helps their overall business strategy.
The insights from IP address tracking can help businesses in understanding their audience, what consumers want, and where they come from.
This knowledge can be invaluable for marketing campaigns, as it gives marketers the chance to make data-driven decisions for their strategy.
Edits to copy, better-optimized passages, or effective call-to-action are all small yet meaningful ways in which businesses can use IP tracking for better campaign results.
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Better Lead Volume and Quality
By identifying when visitors return to a website and what pages they engage with, advanced IP tracking tools can provide meaningful information that businesses can use to grow their lead generation databases and set up effective lead scoring models.
The data can also identify sales-ready leads – information that sales teams can use to close sales and grow their client base.
In this way, IP tracking helps improve the sales pipeline, drive revenue, and boost business growth.
Cons of IP Tracking
While there is a wealth of data you can gain from IP tracking, there are potential issues with the accuracy and collection of that data.
Certain IP address trackers draw the data from public databases owned by the Internet Service Provider (ISP) that often stores out-of-date or less exact data.
On the upside, you can find more advanced tools that use different databases known for more accurate and usable data.
Some of them run data through multiple verification rounds and perform an annual data cleanse, ensuring more precise and consistent IP address information.
Dynamic IP Addresses
Another potential issue of IP tracking is the way IP addresses work. There are two types of IP addresses.
Static ones remain constant, while dynamic IP addresses change whenever engaged with an outside network.
Generally, static IP addresses don’t pose issues, but dynamic ones can cause IP tracking tools to misread data.
Because of this, they don’t always offer usable information that marketers rely on for informed decisions.
Another difficulty of IP address tracking is the lack of specificity from shared IP addresses. Some businesses and home networks work with shared IP addresses, which means several (if not many) devices share the same address.
The shared IP addresses, like dynamic ones, can throw IP tracking tools off and hinder data accuracy.
Although this can pose a challenge if you’re looking to target individuals, it may not cause much hindrance for B2B marketers who are looking to target a whole business.
In such cases, the number of people sharing the IP address will not affect a marketer’s ability to convert that business.
With the fast digitization of the business world, companies need to be ready to invest in new marketing technologies – and IP tracking is no exception.
Some of the benefits of using this technology are data insights, improved campaigns, and better lead volume and quality.
On the other hand, you might face certain disadvantages like data inaccuracies, unreliable dynamic IP addresses, and the inaccuracy of shared IP addresses.
No two businesses are the same, so you should weigh the pros and cons to determine what the best option is for your business – and how you can minimize the downsides.
If you want to learn more about IP and internet privacy we have a whole section on this here.