The digital cosmos is exponentially on the rise and with that advancement in mobile technology has led companies target and interact with consumers in newer and exciting ways; which has brought them further closer. One of such ways is “Proximity Marketing”.

It is a form of marketing, where a brand initiates communication with consumers that’s relevant and personal. It’s all about marketing at the right place and at the right time.

WHAT EXACTLY IS THIS CONCEPT?

Marketers across a range of verticals are now realizing the enormous amount of potential that proximity marketing offers. Also referred to as ‘hyperlocal marketing’, this type of marketing involves targeting potential consumers with personalized notifications, based on how near a consumer is to a particular location and tempting them to make a buying decision.

HOW DOES IT FUNCTION?

Proximity Marketing emerged somewhere around 2008, when companies were able to send location-triggered messages to phones that were in the vicinity to a Bluetooth network and had the “discoverable” mode on.

The foremost purpose is to connect with customers while they are near your company or facility. But there are a number of must-haves required to employ this marketing technique. They are:

The consumer should be using a Bluetooth-enabled mobile device at the or near the location where the technique is being applied.

  1. A beacon must be deployed in the area where the consumer is currently located, in order to send out and receive marketing messages.
  2. The targeted consumer should have downloaded and installed the relevant mobile app on his or her phone that is capable of receiving push notifications.

Since the time with each potential customer is limited, it’s crucial to create short and sharp messages for the interaction.

WHY USE IT?

  1. It helps in a deeper understanding of customers’ buying patterns and catering to them based on their preferences and location
  2. It can lead to a higher conversion rate based on the proximity of a consumer
  3. As per a study by IBM, 72% of consumers will react to a marketing message while they are inside the store

LET’S LOOK AT SOME EXAMPLES

Over the past few years, a number of brands are adopting this method to improve their customer experience. Few of the benefits that these brands have observed are:

1. 71% were able to track and understand customer buying patterns

2. 53% were able to create more relevant and compelling offers in the store

3. 24% saw an increase in sales

4. 24% saw an increase in redemption of offers

Walmart: Launched a unique iBeacon trial in partnership with GE. The retail giant used GE light bulbs to house beacons and to send push notifications about offers to the in-store customers.

Kenneth Cole: They are using beacons to create more personalized customer experiences with an aim to provide value and offers at the time when customers are in the store.

McDonald’s: To promote a new line of coffee-flavored beverages and to enhance customer relationships, they adopted a new proximity marketing strategy via beacons. This proximity marketing campaign via beacons helped McDonald’s achieve 20% conversion rate.

THE BOTTOM LINE

Proximity marketing isn’t just one single technology; it can in fact be implemented employing various methods. Not only this, it’s not limited to just Smartphone usage. Contemporary laptops that are GPS-enabled can also be targeted through some proximity marketing techniques.

Thus, it is difficult to predict what is the next technology, which will take the customer experience further and beyond. But for retailers, this technique could be the next big thing, elevating the shopping experience for their consumers and better revenue for themselves.

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