You hear it everywhere, Geofencing is on it’s way. SONIC, North Face, Old Navy, American Eagle & REI are said to be already embracing it.
Companies such as Placecast, Wavemarket, and Xtify are VC backed, and ready to power it in scalable ways.
The statistics make a marketers’ mouth water:
“Placecast has reported consumers reacted positively with 79 % saying these messages increased their likelihood to visit a store and 65% made a purchase as a result of a ShopAlerts message.”
The Starbucks example makes plenty of sense.
“Imagine the message as your walking to work past your favorite Starbucks location on the way to work, “Vanilla Latte half price until 10am!” If you take action on this coupon, it’s a win-win situation; both the customer & Starbucks are happy with the result.
You would think that this new technology would be an instant hit for the real estate industry, retail shopping, government services, & restaurants. You would think that consumers would be excited about the opportunity to get deals sent to them from their favorite brands when they are already near shopping centers.
However, a very large portion of the feedback on blogs is coming from consumers who say they feel like this is another potential opportunity to be spammed & that it will surely negatively impact their relationship with the brands (see here).
Given the design of LBS mobile services, I would think consumers would only opt-in to brands they are truly interested in, and that those brands would act in a respectful manner.
The relationship should revolve around improve customer satisfaction, offering more relevant deals, & thus increasing sales.
If a brand says, “we can send you more relevant, highly contextual messages about deals, etc. if we know where you are.” Then users will have to decide for themselves whether it is worth participating.
From what I have read I disagree with the skeptics. I don’t cut out coupons, and at the same time I don’t like receiving Target Brand text coupons weeks before I am going to Target. I know I would find convenience in receiving coffee coupons when I am near a coffee shop, and North-Face coupons when I am near a Northface & I would likely be one to opt-in.
Only time will tell how this extremely young industry develops, and what features are enhanced to ensure customer participation. One thing is for sure, if companies like Wavemarket and Placecast are raising millions of dollars from VC backers, it might be worth betting on.
For more on this topic I recommend this article: http://www.mobileinc.co.uk/2009/12/why-location-based-couponingadvertising-wont-work-in-its-current-form/
For those interested in how it applies to real estate in more detail: http://www.softwareadvice.com/articles/property-management/searching-for-real-estate-made-easy-geo-fences-plus-mobile-phones-1030410/