Mar 13 2012

Geo-Fencing: How Retailers Are Leveraging This Technology

As location-based technology matures, retailers are using their geo-fences to entice customers.

If you’ve used any of the major daily-deal sites like Groupon or LivingSocial, then you’ve probably experimented with the instant deals they offer. These work by pinpointing the user’s location and offering up local deals from merchants in that same area.

Geo-fences are the digital perimeters that are used in this location-based marketing. When a user enters within the geo-fence, merchant and marketers are then able to market deals to that user directly. Steve King of Small Business Labs thinks geo-fencing is going to become a big deal in the next few years.

His reasons for this predicted growth are:

  • Smartphone usage has become mainstream
  • Geo-fencing technology has matured and dropped in price
  • Location-based ad targeting is getting more sophisticated and accurate
  • Consumers are more accepting of geo-targeted advertising

For retailers, geo-fencing and location-based marketing could prove to be a more effective means of reaching new consumers and incentivizing these customers to buy now.

This shift to location-based deals is yet another example of how mobile computing is changing everything about our lives — including the way businesses advertise.

For more on geo-fencing, read King’s full post on Small Biz Labs. And for more great content from around the web, check out BizTech's 50 Must-Read IT Blogs.