What is geofencing? How much does it cost? A guide to geofencing marketing.

Geofencing is a popular technology that has been available on mobile devices for years. There are a lot of benefits for using it and a few drawbacks as well. Learn why you should add it to your toolset:

  • What is geofence?
  • How much does it cost?
  • How does geofence work?
  • What is it used for?
  • How is geofencing different from Beacons, NFC, WiFi etc.?
  • When should I use geofencing?
  • What are the benefits?
  • What are the downfalls?
  • How can you get started with geofencing?
Geofence Map

What is geofence?

Geofence is a virtual boundary for a real-world geographic area. Geofence is generated as a radius around a store or point location. Customer receives a push notification on his mobile device as soon as he enters the defined radius. Coupons, notifications, engagement features, security alerts — there are many creative ways to make use of geofencing. Customers who receive a Geofence notification are 2.7x more likely to use app than those who don't receive one.

How much does it cost?

Geofencing does not require any hardware infrastructure (compared to beacons, WiFi, NFC etc.) other than a mobile device therefore it does not have any initial cost. The only cost for using a geofencing is included in the cost of marketing platform.

How does geofence work?

Geofencing uses GPS as well as mobile network triangulation to determine user’s mobile device position and proximity to a set Geofence point. It allows to send push messages to users' smartphones when they enter a defined geographic area, such as a retail store, stadium, shopping mall etc.

What is it used for?

With the popularity of smarphones, geofencing has become especially popular in marketing and social media. There are a lot of different ways a company can use geofencing. Here are a few examples of what marketers can achieve when using this technology:

  • Increase foot traffic with promotional offers delivered to customers as they pass by
  • Suggest products and services based on customer location
  • Redirect customers from competitor venue by building geofences around their locations and pushing special offers.
  • Target ads to a specific audience to figure out what strategies work best based off user’s location-data.
  • Engage visitors during events, like conferences, festivals, trade shows and more.
  • Monitor employees, especially people like real estate agents who do field work.
Geofence on a busy street

How is geofencing different from Beacons, NFC, WiFi etc.?

Geofencing vs. Beacons

The main difference between geofencing and beacons is that geofencing uses GPS signals whereas beacons use Bluetooth to communicate with a smartphone. GPS can have an impact on the battery life of your customer’s mobile device as it requires satellites and cell phone towers in order to pinpoint exact location. Geofencing is perfect for outdoor use though.

# Geofence Beacons
Battery Moderate consumption Low consumption
Range no limit up to 70 meters (230 feet)
Accuracy 5 meters (16 feet) few centimeters
Cost Low (no infrastructure) Low
Best For Outdoor Campaigns, Outdoor Location, Customer Analytics Indoor Campaigns, Loyalty, Indoor Location, Customer Analytics

Geofecing vs. WiFi

The main difference between both techonologies is that WiFi router cannot work without a power source, so outdoor use is very limited whereas geofencing does not require any hardware and is perfect for outdoor proximity marketing.

# Geofence WiFi
Battery Moderate consumption AC (does not work on battery)
Range no limit up to 100 meters (330 feet)
Accuracy few meters few meters
Cost Low (no infrastructure) High
Best For Outdoor Campaigns, Outdoor Location, Customer Analytics Indoor Campaigns, Loyalty, Basic Customer Analytics

Geofencing vs. NFC

Geofence is very different from NFC and comparing they can't be used interchangeably - but they can complement each other when you use geofencing for outdoor marketing and NFC for indoor marketing.

# Geofence NFC
Battery Moderate consumption No battery
Range no limit few centimeters
Accuracy few meters few centimeters
Cost Low cost Low cost
Best For Outdoor Campaigns, Outdoor Location, Customer Analytics Loyalty, Delivering information at a tap, Security Checkpoints

When should I use geofencing?

Geofence is great for numerous business cases, one of the most valuable is increasing the number of visitors in your venue. If you want to let your customers know that there is a promotion in your venue, they can even be located 100 meters away from it, simply add a Geofence spot in Bleesk and create a Campaign that triggers notification "Your Comapny Name: Check out our new collection, you're only 100 meters away".

Another valid business case is that you want to make sure that people will have bluetooth turned on to receive beacon proximity campaigns indoors. You can simply create a Geofence campaign that will trigger a notification reminder "Turn on Bluetooth to receive more special offers". This significantly increases conversion rates for beacon campaigns.

Geofence and Beacons complement each other, so that you can use both of them at the same time.

What are the benefits?

  • The only technology that works outdoors.
  • Geofencing have great price / value factor.
  • Geofencing are easy to use and implement.
  • Geofencing have multiple applications (engagement, outdoor navigation, data, etc.)

What are the downfalls?

Geofencing does not work indoors and is not as precise as other technologies.

How can you get started with geofencing?

Simply contact us and we will help you get started.