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What Is Geofencing & How Does It Work?

2 min read
May 23, 2016

The chances are, you may have heard of the term ‘geofencing’ by now. And even if you haven’t, it’s highly likely that you have encountered it at some point already in your life and perhaps not even realised!

Hurree. The Essential Guide to Market Segmentation. Let's Go!

What Is Geofencing?

Geofencing is essentially the establishing of a virtual fence around a predefined geographical area. Whenever a user with an enabled mobile device enters into this area it triggers an action or notification.

Believe it or not, geofencing has actually been around for longer than you would think. The early systems, however, were targeted at those willing to invest large amounts of money in expensive custom hardware. One example being in the livestock industry where herds of cattle were equipped with GPS units that would alert the farmer if the herd was to go outside of the predefined parameters.

But don’t give up hope yet - geofencing is no longer just a farmer’s toy, or for those with a hefty marketing budget. Thanks to the massive growth in the adoption of smartphones and huge advances in technology that now allows the everyday person to carry GPS, Wifi and Bluetooth in their pockets, geofencing has become an incredibly cheap and easily accessible marketing tool for the modern day business owner.

How Is Geofencing Used?

There is a whole world out there of geofencing potential. Gone are the days of forgetful husbands and angry wives on their wedding anniversary as your smartphone has the ability to remind you to get that bunch of flowers when you’re near a florist.

Many businesses are using geofencing to simply send out notifications to their customers when they are in a nearby area, to inform them of the latest offers in an attempt to entice them into their store. The possibilities beyond that however are endless.

Geofences can also be dynamic, meaning they can change, shrink or grow based on the criteria set up by the user. For example, if you are using geofencing to attract customers into your restaurant, you could target those in a closer proximity to the venue during busy periods of the day. Then, during slower times of the day, you have the option to increase the reach of your geofence.

Why Does My Business Need It?

Geofencing works wonders for local businesses, especially for those that rely heavily on location visits to generate sales, as it allows you to do the following:

  • Engage relevant local shoppers who are likely to respond well to your message
  • Attract new customers by giving them special discounts when they are in your area
  • Win the sale of a potential customer passing by who may have already been on their way to a local competitor
  • You aren’t limited to your own location - target customers who visit businesses similar to yours in an attempt to sway them across town to your store with that cheeky bit of discount you are offering

Hurree. The Essential Guide to Market Segmentation. Let's Go!

With a little bit of creativity, geofencing can go a long way. In this fast paced world, geofencing is making it that little bit easier for businesses to engage with their potential customers while they’re on the move. Consumers today are so connected online and, in many cases, the bricks and mortar business has been forgotten about as a result. Geofencing is the perfect solution for creating that link between the online and offline elements of a brand.

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