The Power of Proximity
There has been a lot of hype surrounding Pokémon Go in the last month or so, with the app being downloaded 26 million times in its first week alone. The app incorporates location services into the game so that where you are, and at what time of day influences which Pokémon you are able to catch. This can mean there is huge opportunity in digital marketing, with millions of people now looking down at their smartphones with location services turned on. It is also changing the way people think about applications, with users wising up to the fact that what they see on their smartphone can be entirely contextual. So how can this be used in marketing? In this blog we will look at how companies are currently using location services and proximity beacons in their marketing, and how this has had an effect on their company’s performance.
Meat Pack: Getting the customers in
One of the best examples of location-based services used for marketing comes from a Guatemalan shoe shop called ‘Meat Pack’. This shoe shop was surrounded by high profile brands including Nike, Adidas, Puma, Reebok and Converse, so developed an ingenious app that would encourage customers to go to them instead. Whenever a person with this app would walk into any of the huge sports shops nearby, the app would register their location and send them a notification that began at 100% off their next purchase at Meat Pack. The percentage would drop 1% every second, so Meat Pack had potential customers literally running to them to make a purchase whilst they could still receive the best possible discount. This app saw 600 more customers through the door in its first week, and one customer managed to get there in 11 seconds, meaning he saved 89% on his purchase at Meat Pack that day.
Carrefour: The power of proximity
Carrefour took the step to introduce proximity beacons into their stores in the hope that it would increase interaction with customers who were actually already in their stores. Customers were sent a welcome message when they walked in, were sent suggestions based on their previous purchases and enticed with offers just as they were nearing certain products.
Looking into Carrefour’s use of proximity beacons is particularly interesting, as they already had an app pre-proximity beacons, so it is easy to compare its effectiveness both with and without. Essentially the use of location services went down so well that the downloads of their app increased by 600%, and the time spent on the app improved by 400%. These are of course very impressive figures, but more importantly this enabled Carrefour to harvest all this data, and accurately understand who their customers are and their in-store behaviour. This in turn meant they could tailor the shopping experience to each individual customer, which made them feel valued and took a huge step towards building customer loyalty.
Macy’s is of course a huge brand, and they have noticed the benefits of proximity beacons in their stores after a successful trial during the holiday season, which has resulted in 4,000 more beacons being placed throughout their stores. The app reminds people to open the app when they are near the store, and guides them around the store giving them suggestions based on preferences – all on a first name basis. App users who ‘opt-in’ to receive notifications will also be sent offers and coupons for items they are actually looking at in real time due to the accuracy of the proximity beacons.
The statistics for this new app rollout for Macy’s were also very impressive. Interaction with the app when location services was activated increased 19 times, showing how making the experience personal made users more inclined to use it, and usage of the app in-store was 16.5 times higher than without location services, again highlighting how location services made the shopping experience more enjoyable, and personal for each individual shopper.
These success stories are all signs of the potential of using location based marketing as a business, and the statistics reinforce this. 57% of consumers are likely to engage with location-based advertising, and 63% of consumers feel offers and discounts are the most valuable for of mobile marketing. With 90% of smartphone users having location services switched on, the vast majority of people can be communicated with on a personal level, and entirely related to what is happening to the user in real time.
We predict that due to these success stories and figures more and more companies will start to utilise this technology. Using location services to interact with customers gives a personal touch to their shopping experience, and making sure customers are happy can lead to the all important brand loyalty that all companies strive for.