How Geofencing Kicks App Engagement Up a Notch

It takes a lot more than clever mobile messaging to appeal to today’s app users. While an anecdotal push notification may have seemed novel to consumers in the past, tailored app experiences like this are now the norm -- not the exception.

Without specialized content that engages users on a regular basis, consumers adopt an “out of sight, out of mind” mentality toward their apps -- the hallmark of failed mobile marketing, and a recipe for high churn. But one of the most effective ways to drive personalized engagement and avoid upticks in app abandonment is location-based messaging fueled by geofences.

A geofence is a digital perimeter that brands place around physical environments that offer unique opportunities for “in-the-moment” engagement with their users. What better way for a retailer to drive brand awareness, for instance, than alerting app users to an in-store promotion when they’re near the brand’s brick-and-mortar? Or better yet, using geofences to divert users from purchasing elsewhere by enticing shoppers with push notifications before they enter a competing storefront?

While the implications for retailers are clear, geofences can be applied to apps across sectors to drive user engagement. In fact, mobile campaigns that leverage location targeting outperformed non-location targeted campaigns by a factor of two-to-one, while geofenced ads have proven to be up to 12 times more cost effective than bidding for keywords -- regardless of the industry or sector.

However, simply using geofences to send out a blanket message to all local users is no way to harness the true power of geofencing. For the best results, here are a few tactics that brands should consider when using geofences.

Creating a Lifestyle

For starters, geofences -- and triggered app messaging in general -- don’t have to explicitly be about driving (or thwarting) immediate sales. Even for retailers, much of the value of effective geofencing is derived from creating a lifestyle around the app, or at the very least inserting the app into the user’s day-to-day in a meaningful way.

Take the outdoor apparel brand The North Face, which was among the first retail brands to implement geofences on a large scale. While the company leveraged geofencing in a conventional way to send push messages to app users when they were in proximity of The North Face stores, the brand also used this technology to update their customers about the weather and their environment -- a natural fit for a retailer that’s all about the great outdoors.

By sending customers weather-related geofenced alerts, the company saw a 79 percent increase in foot traffic from app users, with 65 percent of those users ultimately completing a sale. More importantly, however, this helped The North Face become a more than just an outfitter, but a resource for information about their target demo’s outdoorsy habits that lends the brand authority among potential shoppers.

Bringing Brands to Omnichannel

Geofencing is also a great way for brands to foster the omnichannel relationships with users that that will be essential to their success in the years to come. Studies show that even when users are in a brick-and-mortar storefront, they’re likely engaging with that brand on mobile, and that when users aren’t using their phones to surf the web, 86 percent are engaging with their apps.

The challenge here is ensuring that users are stimulated by the brand at all of these physical and digital touchpoints, which geofences can help orchestrate. Walmart, for instance, has one of the largest physical footprints of any retailer globally, yet also has emerged as a wildly successful ecommerce operation over the past decade.

A unique characteristic of Walmart’s customer base is that roughly one in five of the sales completed online with the company are picked up in stores. The Walmart app has geofences around the brand’s physical locations that triggers coupons and e-receipts to users who may only be intending to pay a quick visit to the store in an attempt to get the to stick around for a while. The key to success here is that the app is catering to buyers with specific habits, delivering promotions that align with a shopper’s purchase history, while only triggering the alerts when the user is local, not around the clock.

Harnessing More Data

Walmart’s success with geofencing hinges on analysis of user data, which geofences are great at helping brands collect. The data sets created by geofences paint a more detailed picture of each app user’s day-to-day, which brands need to leverage intelligently to keep their apps relevant and avoid that “out of sight, out of mind” mentality among users.

Geofences are also a practical tool that delivers value to brands beyond marketing. The Honeywell Lyric, for instance, isn’t the first smart thermostat to enter the increasingly crowded market. But Honeywell leverages geofencing to distinguish itself from more established providers by intuitively tracking the number of app users within a designated environment and moderate fuel consumption automatically. The Lyric automatically delivers savings to users without inundating them with push messaging, making it an asset to homeowners.

For all the value that geofences offer, they are surprisingly simple to implement, making them an essential asset for any mobile marketing initiative. Localytics’ own Places feature lets you target customers using geofences with a few clicks, and is equipped to handle all of the data that brands collect. If you’re ready to try geofencing for yourself, check out Places here.