Four Types of Location Based Advertising and How They Work

Advances in technology by companies like LoMo Advertising over the past few years have enabled us to be much more savvy when it comes to connecting with our target audience. We can be increasingly specific about who we target based on behavior and geographical location.

As the key to any advertising campaign is to find the people who connect with the message, using location based advertising is making this more possible for brands by capturing the very people they want to speak to.

And, as having a smartphone is becoming the norm, businesses are able to target users based on their GPS location with tailored ads and offers. This provides a contextual ad experience that people, especially millennials, are becoming more and more accustomed to.

To give you an idea of how this can be done, here’s a summary of some of the key types of location based advertising (LBA) and how they work.

Behavioral targeting

This is based on a user’s actions or geographical location. For example, if you’re a regular business traveller, hotels can tap into this information by looking at your GPS activity and offer you discounts on their loyalty schemes. The likelihood is is that you won’t disregard this as a ‘meaningless ad’ but find it useful as it is tailored to your specific behavior.

Using this technology, brands can work out the key characteristics of their audience such as whether they’re into fitness (frequent gym goers) or if they are regular travellers and tailor their ads accordingly.

This can be taken a step further and used to target your competitor’s customers. For instance, a local pizzeria opens up on a quiet high street, how do they attract new business? Using behavioural targeting, they can find out who eats at the busy Italian on the main street and send them offers and discounts; enticing them to eat there.

Radius targeting

This form of advertising allows you to display your ads to people in the direct vicinity of your store. Historically, businesses would advertise to a whole town in a directory or on a billboard but now, they have the power to target those actually walking past their store. For example, a bar owner hears about a local food and drink festival and wants to capture people new to the area. Using radius targeting, they can send out specific ads to those people, incentivising them to pay a visit before they leave.

This is a powerful way of capturing your audience in realtime, which can have a significant impact on their decision to shop with you.

Local search advertising

When you type into Google ‘restaurants nearby’, you’ll be presented with a map featuring pinpoints which indicate where they are in your area. You may also have prices and reviews pop up which is all part of local search advertising. With almost a third of all mobile searches now related to location, brands are becoming increasingly aware of the importance of this channel and are investing budgets to ensure they appear clearly on the map. These local searches can also link to your business page, which in turn helps to drive more traffic to your site and generate enquiries.

Nowadays, three out of every four people who search for something nearby using their phone visit that location the same day and over 25% those searches lead to a purchase. For local businesses, this is great news as having a presence in this form of search really can drive footfall.

Geo targeting

It’s no secret that with the rise of the internet, driving footfall into high street stores has become increasingly challenging for businesses. However, geo targeting is helping to turn this around. With the power of location based advertising, brands are able to be much more strategic and target people in the vicinity of their stores and, in turn, incentivise them to shop there.

57% of people are more likely to interact with a location based advertisement and more than 50% of mobile users give their location to get this ad experience. Therefore, people are becoming more accustomed to walking into a mall receiving a push notification about a flash sale at a nearby clothes store. It isn’t an annoyance but something that they find enhances their shopping experience, making them more likely to visit said store.

There are all kinds of ways businesses can implement this and it’s becoming an important part of many marketing strategies to stay ahead of the competition.

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