Geomarketing

Geomarketing deals with the geographical conditions in marketing. Regional aspects affect the entire marketing spectrum such as a company’s range of products, pricing, distribution and communication policies, in other words, almost every business sector.

Definition

Geomarketing is the integration of geographical intelligence into various aspects of marketing.

Metropolis-countryside comparison

Existing and potential markets are analyzed so that they can be targeted even more effectively. For example, people in big cities tend to be more willing to pay a higher price for a product than people from the countryside (pricing policy).

In large cities, easy access to a supermarket with public transport is particularly important. In the countryside, on the other hand, this factor is secondary to the size and proximity of the parking lot (distribution policy).

Data Material

Such market intricacies are worked out based on extensive data in the context of geomarketing, which is analyzed and used for precise approaches to target groups. This includes statistical data such as:

• Number of inhabitants
• Number of households
• Age Structure
• Proportion of foreigners
• Unemployment rate
• Vehicle inventory
• Purchasing power or average household income
• Development structures
• Companies on site
• Living environment
• Commuting on the streets

Examples and applications

Geomarketing has an extensive range of application. The data can answer questions like these:

• In what regions is the target group most strongly represented?
• Where should new branches or locations be opened strategically?
• In what regions are sales concentrated the most?
• Where is there previously untapped potential which could be activated by stepping up advertisement?
• Which area does the clientele of a company mostly originate from?
• Is the current site chosen wisely or would relocation be useful?
• Could the sales force optimize its work through better territory management and make it more efficient with more skillfully selected tours?
• In which sales areas should the region from which the company gains the most clients be divided?
• What competitors are located in the area?
• What methods of communication policy are most suitable in what areas?
• Where is it worth to set up location-based services (such as coupons via smartphone app)?
• In which regions have sales declined or increased?
• Is the company’s range of products and services adapted to the target group in the region or are modifications required in order to utilize the full potential?

Geomarketing with Foursquare

Foursquare is a social networking service available for mobile devices such as smartphones, mobile phones and tablets. To use Foursquare you download the free app which works on the basis of GPS localization. The app's purpose is to help you discover and share information about businesses and attractions around you. More than 45 million people and 1.6 million entrepreneurs worldwide use Foursquare. There are several million venue check-ins a day.

Functional principle of Foursquare

Foursquare is primarily used via mobile devices. Accordingly, free apps are available for Android and iOS devices, BlackBerrys, Windows Phones and Palms. The technical platforms PlayStation Vita, Symbian, WebOS and bada are also covered. Users log into Foursquare and as soon as they reach a certain location (venue) they “check in” and thus share their location with other users.

Venues can be all sorts of places in the vicinity such as attractions, shops, restaurants or plazas. Users can use Foursquare to get suggestions for the best restaurants in town to plan a weekend getaway or to find out how others rate certain locations. One’s own check-ins and information will be shown to befriended users.

What sets Foursquare apart from other social networks, is the playful aspect. For each check-in the “players” earn points. You can earn various badges, such as the following:

• Superstar: check-ins in 50 different venues
• Crunked: four check-ins in one night
• Bender: four check-ins in four consecutive nights
• Local: three times the same check-in in one week
• Superuser: 30 check-ins in a month

Additionally, players can be “Mayor” of a place if they have registered the most check-ins for the venue within two months.

Foursquare for businesses

Many companies are listed with Foursquare without having registered themselves. Users who have checked into the venues made the entries. However, the company owner can take possession of their venue and thus control any content published on it.

In particular, they can upload a kind of business card and list on it their address, telephone number and even a company description, opening times, a web address, links to other social media profiles, menus, services and additional information.

Foursquare Advertising

In addition to company profiles, entrepreneurs can advertise in Foursquare. Such advertisement is very much customized. An ad may be displayed to users who are in the immediate vicinity of a certain business or restaurant.

The advantage of Foursquare ads is that advertisers don’t have to pay a flat rate or by number of views, but only after appropriate responses to the advertising.

As you know from similar ad networks, operators can retrieve various statistics to keep an eye on their budget and at the same time be able to evaluate the response rates to promotional activities.

Brand pages

Brand pages also can be set up. They provide an opportunity for companies that do not have a specific office establishment or location to present themselves in the social network. Depending on the individual objectives of brand pages, users can acquire “fire badges.” Thus, for example museum fans, that visited the Museum of Modern Art of New York three times, would be awarded the badge “Art Addict.”

Geomarketing with Foursquare

Companies, which are listed in Foursquare, can offer their visitors incentives to buy from their business as often as possible (such as discount coupons, small gifts for customers upon purchase, etc.). Beyond that, Foursquare offers the option to analyze how many of the visitors are first-time buyers, occasional customers or repeat customers. Using the GPS function of mobile devices you can find out more about the location structure of the clientele.

Foursquare offers diverse evaluation options that depict the success of geomarketing.

Geo Marketing with Facebook Places

The Facebook Places service was launched on August 18, 2010 and is also available for mobile devices on Android, iOS and BlackBerry devices, since October 2010.

Functional principle of Facebook Places

Facebook Places is not a standalone service, but rather part of the social network Facebook. When users post a status update, they can automatically attach their location to the post via Facebook Places so that all their friends can see where the user is currently located. This feature is available only for devices that have an activated GPS unit.

Until August 2011, there was an additional option with which you could “check in” at different locations similar to Foursquare. Moreover, since November 2010 Facebook Deals was available to users, by which you could take advantage of coupons and other actions on your smartphone. However, both features were discontinued in August 2011 and replaced by the Geo-Status.

Geomarketing with Facebook Places

Geomarketing with Facebook Places works similar to Foursquare. Users can create locations that they have visited. Companies can take charge of it if they are the owners. They can also to link the fan page of their company and its Facebook Places listing.

The company can get various reports on fan activity with Facebook Insights, the statistics function of the service. If it is a places listing, people who have already visited the store can also be analyzed. This makes it possible to provide specific offers aimed at buyers according to their personal interests.

Importance for the Online Marketing

Geomarketing is of great importance especially for businesses that are established and operate locally, such as regional service providers, craftsmen and retail outlets. For smaller businesses, the marketing tool is just as relevant as for large textile retailers with hundreds of stores.

In particular, with the backdrop of topics like Big Data and the better availability of extensive user data, it can be assumed that the significance of geomarketing is going to rise sharply in the future for online marketing.

There are a lot of data sources available for this area, making the targeting of specific groups easier. Advertising can therefore be placed with a minimum of wastage and the goal of reducing costs in the long term.

There are many other aspects which make geomarketing a topic for the Internet:

• Display of websites in the language of the user, depending on their location
• Regionally different SERPs in Google (for example if you search for “ophthalmologists” in New York you will get ophthalmologists in New York, however, if you do this search in Los Angeles you will get ophthalmologists in Los Angeles)
• Distributing coupons via social media services

In 2011, 90 percent of marketing agencies in the US had requests for online ad campaigns based on geotargeting. 65 percent of companies include geographical data in their mobile marketing strategy. Local marketing is also significantly less expensive than classical SEM.