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Geofencing vs. Geotargeting

As technology has continued to evolve in the last decade, marketers have been closely watching and anticipating the progression of geomarketing, or the application of location intelligence to effectively market products and services to consumers.

Through the popularization of social-media ad campaigns, you are most likely already familiar with geotargeting; however, geofencing is gaining ground as a highly effective geomarketing resource with data to boot. Let’s dig in to understand which tool is most effective at reaching your target audience.

Geotargeting is the establishment of a hyper-segmented market based on both the consumer’s location and specific criteria, such as behavior, demographics and interests. The latter is geotargeting’s primary advantage, which allows businesses to ensure their ads are delivered only to consumers within a defined zone that meet niche criteria, such as vegetarian meals, or are between the ages of 25 and 30. However, because the ads are delivered based on criteria such as demographics, geotargeting tends to be more successful when working within large locations, such as across an entire city or state. You are simply more likely to reach your hyper-targeted market with a wider net than a narrow one.

Geofencing is the establishment of a hyper-targeted location by defining a virtual fence around a defined radius, allowing businesses to target messages to consumers as they enter a given zone (e.g., as attendees are entering a brick-and-mortar store or trade show). Generally agreed to be more accurate than geotargeting, a primary advantage of geofencing is in its use of GPS technology to guarantee consumers are tracked to their very coordinates. Collected data can then be used to track how much time consumers spend in the defined zone, as well as how frequently they return. Alternatively, the same advantage to geofencing is also its disadvantage – such ads are targeted solely to consumers that enter the predefined area. They cannot be further segmented. For example, regardless of nationality, all consumers will receive the same message in the same language – likewise, men, women and children also see the same ads.

So, which tool is most effective at reaching your target audience? While there are advantages to both geofencing and geotargeting, geofencing is a highly effective approach when it’s critical that your advertisement reach consumers within a specific neighborhood, store or conference area, as well as when you want to know how frequently those consumers cross your fence.

Alternatively, geotargeting is more appropriate when it is critical that your message reach consumers with specific interests or biological makeup. However, the marketer that finds a subtle blend between the two based on an analysis of each goal within their marketing strategy will likely be 2018’s winner.


Article originally published by the Memphis Daily News and RedRover Sales & Marketing Strategy.

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