Ever noticed how, just as you pass by Starbucks, your phone buzzes with “Get 20% off your favorite drink!”? You’ll see the same thing when you’re near places like Burger King or Sephora.
This isn’t random—it’s called geofencing. Big brands use it to reach you with timely deals based on your location.
For online sellers like you, geofencing can be like a welcome sign, reaching customers when they’re in the perfect spot to act.
Today, we will look at what opportunities geofencing can unlock for you and how those opportunities could impact your online business.
So, how exactly does geofencing work?
Geofencing is like setting a virtual boundary around a spot—your store or a high-traffic area—using GPS, Wi-Fi, or Bluetooth. When someone with a smartphone steps into that area, it triggers an action, like sending them a notification, discount, or message.
Think of it as a “virtual welcome mat” that rolls out as soon as a potential customer is nearby, inviting them to engage with your business before they even walk in.
For online sellers, geofencing is a way to connect with local customers and spark real-time engagement right when they’re close and ready to act.
Imagine it like catching a glimpse of a fresh pastry in a bakery window; just like that tempting croissant draws you in, a well-timed geofenced offer can get customers thinking, “Why not?” and encourage them to click "buy."
I highlighted Starbucks, Burger King, and Sephora earlier because they’re some of the most well-known brands using geofencing.
Starbucks, in particular, is one of the first to perfect this method. As I mentioned, when you approach one of their stores, you might receive a message about their current promo or discount.
This gentle nudge does more than just remind you about Starbucks. It also makes it easy to decide on a treat, especially if you weren’t planning to stop.
This approach boosts foot traffic while strengthening the brand's relationship with its customers by making them feel like they’re receiving a personal invitation.
Burger King used a different twist with their famous “Whopper Detour” campaign. By setting up geofences around McDonald’s locations, they sent notifications to anyone within 600 feet of a McDonald’s, offering a Whopper for just a penny if ordered through the app.
It was a lighthearted jab at the competition and a brilliant use of geofencing to boost app downloads and foot traffic. In this campaign alone, Burger King saw millions of new app downloads, demonstrating the power of geofencing when applied creatively.
Meanwhile, Sephora’s geofencing strategy revolves around delivering value to its customers. If you walk by a Sephora, you might get an alert about an exclusive in-store promotion, a reminder about your loyalty points, or a recommendation based on previous purchases.
This approach keeps Sephora top of mind, especially for frequent shoppers who feel engaged by the tailored offers and are reminded of loyalty perks that are always just a quick visit away.
The thing is, you don’t need to be a huge brand to make geofencing work for you.
Let’s say you have a pop-up store. Imagine setting up a geofence around your pop-up location to alert nearby shoppers to your sale.
Just like Starbucks nudges people with timely messages, your notification could read, “Stop by for a 10% discount on all items today only!” This tiny nudge works like magic for drawing in curious customers who might otherwise walk past without knowing about the promotion.
If you’re strictly online, geofencing can still be a fantastic strategy. For instance, you can set a virtual boundary around certain neighborhoods or cities and run targeted ad campaigns for those areas.
This approach is effective for limited-time offers or location-specific promotions, like offering free local delivery for customers in your area.
If you know that a high concentration of your audience is in a certain city, this lets you “nudge” those customers into action with an exclusive deal that’s relevant and timely.
You can also use geofencing to gather insights on customer locations and behavior, which helps you refine your targeting and create more personalized offers.
This data lets you see which regions respond best to your promotions, adjust your inventory based on local trends, and plan special events or campaigns for specific locations.
Here are some numbers that might convince you to invest in this technology:
Brands that use geofencing regularly report significant increases in engagement and sales. According to a survey by Statista, 53% of shoppers who received location-based notifications visited a store because of it.
Another study found that geofencing can increase app engagement by as much as 200%, as customers are more likely to open an app and engage with its offers when they receive timely notifications.
Even online brands with no physical store report benefits. A report from Factual shows that location-based advertising (like geofencing) yields engagement rates 20 times higher than standard mobile ads.
With online sellers competing for attention, this focused approach is like a megaphone cutting through the noise, reaching only those customers most likely to act on your offer.
That said, geofencing, like any other marketing tool, works best when applied thoughtfully. There are key best practices to keep in mind.
If you’re looking to try geofencing, start with a simple campaign. Determine your primary customer locations and decide on a radius—maybe it’s a neighborhood or even a particular shopping district.
Once you’ve set up your geofence, create an offer or message that feels relevant to that area.
Keep in mind that subtlety works well here. You want customers to feel like they’re being offered something special, not overwhelmed.
For example, a message like “Enjoy 15% off just for stopping by!” sounds enticing without feeling too pushy. And remember, geofencing works best when paired with an app or mobile-friendly website, so customers can seamlessly engage with your offer.
Lastly, pay attention to timing. Consider how long people typically spend in certain areas. If you’re targeting a shopping district, short, quick notifications work best, as people are likely browsing and moving.
But if you’re focusing on office areas during lunch hours, a reminder about a limited-time deal around noon could capture their attention.
How do you do it?
Getting started with geofencing is easy—just pick a platform and follow the steps. Each one has unique features, so you can choose what works best for your goals, like boosting foot traffic, increasing online sales, or improving app engagement.
If you want strong location-based tools to gather insights and target nearby competitors, GroundTruth, Foursquare, and Reveal Mobile are great options. For something simple and affordable, Facebook Ads and Google Ads let you target specific areas and work well with social media campaigns.
If you have a mobile app, Radar or MoEngage can send location-based notifications to make interactions feel more personal. And if you need pinpoint targeting down to exact addresses, Simpli.fi is a powerful choice.
Each platform can help you connect with customers in the right place at the right time, so find the one that matches your business needs and start reaching out today.
By reaching customers where they are, exactly when they’re ready, geofencing makes your connection feel personal and timely. This helps close the gap between you and your customers, shifting from broad marketing to focused, meaningful engagement—like offering a warm coffee to someone on a cold day.
If you’re aiming to boost sales, increase engagement, and make your brand memorable, geofencing could be the key. It turns casual browsers into loyal customers right when they’re in the ideal spot to act.