Proximity marketing is one way businesses, especially retailers, can produce near one-on-one marketing experiences with consumers. The notion of a “segment of one” in marketing is a bit utopian, but the rewards of creating tactics to get closer and closer to connecting with buyers just in time are well worth the investment. By knowing location and time, even with limited or no additional demographic information, businesses can make assumptions about consumers. These assumptions help them more accurately target their messages.
Proximity marketing, sometimes called location marketing, is wireless distribution of advertising in a specific place. The ad content transmissions are received by on enabled devices (mobile phone, Bluetooth or Wi-Fi device) in which the prospective consumer has opted in to receive them…or at least not opted out on their device’s settings. In some cases, this may be in conjunction with the use of a mobile app.
Just like Kmart’s Blue Light Special
Really, proximity marketing is just the more technologically advanced version of Kmart’s blue light special. From 1965 to 1991 and a few sporadic times since, Kmart, a discount retail store, offered surprise in-store sales. A store worker would light up a mobile blue police light in the area of the store where the short-time discount was offered. And an announcement over the store’s public address system would begin, “Attention, Kmart shoppers…”. With modern technology and the combination of proximity shopping with a downloaded mobile app, the marketing can become even closer to one-to-one. For example, if the blue light special was for dog food and you had a cat, you just went about your business of shopping. But combining locally broadcast ads with an app, you can know a lot more about a specific customer. Perhaps the app has discovered that a consumer owns a pool, then as they walk in the door of your store, you can offer discounts on pool supplies. If the app knows they own a pool and have an annual income over US$250,000, the ad can be for higher end automated pool cleaners or luxury pool toys.
Examples of Proximity Marketing
Even without the use of a mobile app, proximity marketing has boundless applications. Here are a few examples of how this technology can be implemented:
- Conference or convention – change messages broadcast to attendees based on what breakout sessions are happening. Perhaps at a home and garden show, if the main stage features a celebrity landscaper, then ads might broadcast time-sensitive discounts for people who shop online (or at a booth) for that celebrity’s products.
- Concerts – When do people want to buy music? While they are at a concert! Broadcast of discounts for online or offline shopping for music, T-shirts, and other fan paraphernalia are effective when the artist is onstage.
- Restaurant – 30 minutes after diners enter a family restaurant, offer dessert deals.
- Retail – As a customer enters the automotive area of a store, offer discounts on products found in that area.
- Improvements in existing retail one-to-one mobile apps – Target stores have a useful app called Cartwheel. Once downloaded onto your mobile phone, in-store shoppers can scan product UPCs to see if there are deals (coupons or price reductions) associated with the item. Deals of interest are placed into a cart. When checking out at the store’s register, a scan of the accounts QR code displayed on the phone results in all selected discounts being applied automatically. No clipping coupons and consumers are more likely to find more discounts than without the app, plus Target can advertise its credit card or other complementary services on the app. The app builds store loyalty. But how much more effective would it be if the consumer did not have to scan the product, but rather was guided to the products the store wants to sell to them based on demographic data?
Secondary Proximity Marketing Ideas
There are secondary market opportunities for proximity marketing technology. Consider these ideas for enterprising businesses to sell ad space:
- Hotel – Restaurants tend to locate themselves next to hotels, especially when hotels don’t have their own restaurants. Hotels can sell proximity marketing broadcasts to the restaurants. For example, when a customer enters the hotel between 5:00 p.m. and 9:00 p.m., they receive an advertisement for the steak house across the street.
- Shopping Malls – Malls are full of people interested in spending money and getting deals. What better place to sell advertising to stores. A mall can be divided into multiple localized areas to offer ads for stores that are in the immediate vicinity.
- Car Parking Garage – When most people return to their car after a long day at work, they think about going straight home or worse, the errands they have to run before getting home. Usually they are tired and hungry or at least thirsty. Surely there are some drive-thru fast food restaurants very near the garage that would be willing to buy the privilege to offer discounts to all those weary commuters.
- Mass Transportation – This industry has a long history of selling ad space on the sides of its vehicles. But proximity marketing brings a whole new set of possibilities. A different ad at every stop for businesses located in that area? Great idea!
The challenge? Most people hate push marketing so brands will have to be valuable and engaging, think non-promotional. Otherwise consumers will opt-out and all your broadcasting will be for naught. Remember that any marketing tool should be just one piece of an overall integrated marketing plan including offline and internet marketing strategies.
What are your Experiences with Location Marketing?
I’ve barely scratched the surface of the possibilities of proximity marketing. Share your ideas. Have you used proximity marketing? Tells us what you have learned!
Image credits: Brand Republic