Increased usage of mobile devices gives advertisers new ways of acquiring and retaining customers. Marketers who know how to use the power of Bluetooth, Wi-Fi or geographical data can display an elastic range of content on mobile devices. Proximity marketing is the practice of promoting products or services based on a customer’s physical location. This form of promotional activity takes place in the context of a digital-intensive world where users may choose to focus on their virtual activities in different ways. Let’s get a little closer to the idea of proximity marketing.
Where can you use proximity marketing?
The first places that come to mind when discussing proximity marketing are public and leisure facilities such as hotels, restaurants, stadiums and airports. The truth is you may run mobile campaigns based on proximity marketing from any business location. This is because any business with a physical location can target customers and communicate with them within a certain radius.
So no matter what business branch you operate in, this solution can be for you. Technology has not only enabled marketers to influence the customer’s purchase decisions but also accelerate them.
The most popular proximity marketing solutions
There is a variety of ways in which proximity marketing can be used by companies to further their sales and boost brand awareness. These include:
- Local advertising
- Mobile advertising
- Social applications
- Retail check-ins
- Distribute media and information
You can choose one of the common types of proximity devices or the possibilities they give. For example, Wi-fi, beacon or GPS marketing companies. If you’ve ever gone to use free WiFi in a hotel, at the airport, in a restaurant or if you use mobile applications with GPS on, you’ve seen it first hand.
If you get access to a welcome splash page, you can communicate with your clients. How does it work? Let’s say you are on the way to work and you need an internet connection. You look for a gallery, restaurant, cafe or any other place that offers free public wi-fi. However, the cost of connecting to a public network is counted not in dollars or euros, but in personal data. You will pay for the internet connection by giving permission to communicate with you through the devices you used to log in.
You have a chain of shoe shops and you want to use the possibilities of proximity marketing to communicate with clients. Here are your Wi-fi zone options.
- Prepare an advertisement or information banner that you want to display to customers before connecting to your network
- The client of your local store connects to the Wi-fi network – make sure that the login page is intuitive.
- Add a few methods of logging in. It can be via Facebook, Google+, etc. Remember to add the option of opening a new account.
- When logging in, the client will see your advertisement, so prepare it well to hold the customer’s attention.
As you can see, Wi-fi zone is a good solution if you have a physical store. It gives you the opportunity to connect with customers even if they leave your location. All you need is to get permission to communicate with them.
The magic of GPS
Share GPS data to mobile companies is not a new possibility but the most popular one. You can send advertising messages to the phones of customers within a one-meter radius! To do this, you need a mobile application for clients and permission to get access to the location of customer’s mobile devices. If you know where your clients are, you can advise them on how to get to the nearest shop where they can find your product. In this scenario, GPS campaigns seem to be the best way forward.
One of the best ways of using GPS in effective communication with clients is the geotargeting of SMS messages. This solution works especially in large cities and for the promotion of premium brands.
You are a marketer in a company that sells children’s apparel. At this moment, your company is offering a discount in a local store. You have to sell your old collections quickly because the new collection is waiting in the warehouse. In this situation, you can use geotargeting to increase sales.
- Choose the method and database for sending SMS messages.
- Use geotargeting in your system of marketing automation by sending messages to your customer base. The condition is having a mobile application to track customers’ location.
- Use an SMS system. Most of them have geotargeting options and their own database, which increases the chances of reaching a larger group of recipients.
Beacon or Bluetooth devices can deliver teaser content within venues to attendees. To start working with Beacon solutions, the company will need to have an App, Bluetooth connection, and beacons. This is enough to promote and effective campaign.
But what exactly are beacons and how do they work?
Beacons are small devices that can send Bluetooth signals to a smartphone, tablet or smartwatch. The signal from Bluetooth reaches phones near the Beacon device and interacts with the mobile applications installed on those phones. When the signal from a beacon reaches a phone, it triggers specific actions, like notifications based on localization.
Beacon technology is very useful in mobile marketing, but you should remember that the interaction between a mobile phone and a beacon device is not automatic. The recipient has to enable Bluetooth on their phones and opt in to get signals from beacons for a specific mobile application.
Scan the code and be scanned by the code
QR codes are often used in print: magazines, posters, brochures and outdoor advertising. When you scan the code on your mobile phone, you get access to further information about the brand, product or event.
QR codes allow you to engage clients because they prompt a specific action, scanning the code. Research shows that customers who are more involved definitely buy more often.
Proximity mobile payment
As the name suggests, mobile payment proximity connects mobile payments and proximity marketing based on location. The convenience of being able to implement payments via smartphone is a key factor behind its rapid spread in popularity.
There are multiple methods for payment via smartphone, like Near Field Communication (NFC) or QR code.
The customer connects a smartphone to the reader (POS) and enters a PIN or other authentication to confirm the transaction. This technology is based on a two-dimensional barcode, in which information is coded in order to enable proximity transactions using a code reader on a smartphone.
Here we have two scenarios. The first and the most popular is when the customer opens the App and displays a QR Code generated for the transaction. The merchant scans the QR Code, and the amount is deducted from the customer’s wallet. The second way is used when customers open the App and scan the QR Code from merchant.
We’re talking about payments so we can’t ignore the numbers involved. Mobile payments are one of the most developed global technologies. Research indicates that the popularity of mobile payments will continue to grow. Every year MPP will have 100 million new users. It is estimated that in 2020 their number will exceed one billion.
The number of proximity mobile payment transaction users worldwide from 2016 to 2020 (in milions):
The future of proximity marketing
AR (Augmented Reality) is a technology that imposes a computer-generated image on the view of the real world of the user. In 2017, Apple released Augmented Reality SDK for developers, a big step in the development of the powerful iOS AR app. But to use this solution commercially, we need improved mobile devices, because additional hardware like an depth-sensing camera will be required. This is the main reason why Augmented Reality is probably the most difficult and expensive proximity marketing solution based on the Internet Of Things; it’s largely limited to the companies with the resources needed to develop this technology.
Tim Cook, CEO of Apple says:
I see things that consumers will love on the gaming side and the entertainment side. I see business-related AR apps as well. They’re going to be great for productivity and between small and large business.
Thanks to the use of augmented-reality (AR) technology and IKEA’s know-how, the IKEA Place app made its debut to great success. This application shows exactly how more than 2,000 furniture items can fit in our homes. The IKEA Place app uses the iPhone camera to show certain pieces of furniture in 3D. Most of the items are larger, such as sofas, dining tables or wardrobes.
How does it work?
The IKEA Place app is free to download from the App Store.
- Download IKEA Place onto your phone.
- Select a space that’s in need of some new furnishings.
- Choose place for furnishing – and check its match.
Since launching on Apple devices last September, the app has been downloaded over two million times. More than a million are regular users. The potential of such an AR-based application is high. But to update payment options, we need to know what customers want, how they use the application. Examples from IKEA show that we are really close to using AR in business actions.
Proximity means perspective
Appropriate application of using proximity marketing solutions influences customer choices. The use of proximity marketing tools also allows brands to shorten the client’s decision-making journey. Until now, many marketers have considered proximity marketing as time-consuming and expensive.
However, given the huge number of global smartphone users and the improving accuracy of location sensors, proximity campaigns will become a fixture of marketing. Thanks to the use of external systems supporting marketing activities, marketing using mobile devices, geolocation and beacons will become more and more available. It’s worth investing in this technology because proximity marketing tools allow brands to shorten the client’s decision-making journey, increase their engagement and eloyalty.