There is no shortage of terms, jargon, or three-letter acronyms in the ad tech lexicon. This is problematic for many reasons. One, if your sales pitch is littered with esoteric words, the likelihood of being able sell that product is low. Two, it's hard to cut through all the noise and identify which of the trendiest terms has a viable tech stack behind it. Three, even if you are well versed in the ad tech lingo, subtle nuances cause confusion. Case in point: "geo-behavioral targeting" and "geo-fencing."
Perhaps because these two solutions buck the acronym trend, they have not been as buzzworthy as AI, AR, VR, CTV, OTT—you get my point. But one of the biggest opportunities for marketers right now is literally right under their noses! It's location-based mobile advertising. Two of the most commonly used types (geo-behavioral and geo-fencing) however, are not synonymous and cannot be used interchangeably. They've both been in use for several years, but with new capabilities and innovative strategies, their impact is growing. So, what's the big deal and what's the difference?
The big deal is that 77% of Americans own smartphones and 9 in 10 US smartphone owners use real-time location based services. With the rise of smartphone usage, location-awareness technologies (Wi-Fi, beacons, GPS), and our always-on cultural obsession, there is a massive amount of location intelligence available for marketers to leverage. 2017 is projected to see location-based mobile ad spend reach $12.4 billion and continue growing to $32B by 2021, to make up 45% of all mobile spend. If you didn't know before, now you do: mobile is mainstream.
Geo-behavioral targeting, which considers where a person actually goes in the physical world, is a set of actions that marketers use to define consumers as a frequent flyer, returning shopper, or a sports fan. The value of geo-behavioral isn't limited to real-time location data. Historical data can also be gleaned, creating a tremendous opportunity for brands to connect with consumers during critical decision-making moments. Being able to differentiate between Person A, who passes by a sports stadium every day, and Person B, who spends hours there throughout a season, directly influences your brand strategy and message.
Our location data solution, ProximityPlus, has proven to be an effective way for marketers to engage with on-the-go customers. Using data collected from beacons, Wi-Fi, and GPS, ProximityPlus also takes into account three location-based variables: point of interest, dwell time, and visit frequency. When combined with additional user data such as behavior, purchase history, and demographics, marketers can more accurately gauge a consumer's true purchase intent and personalize its localized video for the business traveler, loyal shopper, and millennial-aged season-ticket holder. By focusing on real-world, offline behaviors, this is true geo-behavioral targeting.
In contrast, geo-fencing places a virtual fence around where your customers are, or where you hope they will be. Anyone who steps into this virtual perimeter is targeted, usually instantly or shortly after pinging the fence. Because geo-fencing only uses geographical location data, marketers can end up targeting unspecified audiences with less-than-relevant messages. In a world where consumers crave authenticity, geo-fencing should be combined with the power of geo-behavioral. For example, geo-target a 20-mile radius around your brick-and-mortar store to any customer who has visited once per week, for at least 30 minutes, in the past three months. You can then geo-fence your store—or even your competitor's—so that the moment a customer sets foot in the geo-fenced location, more timely information about daily offers and promotions can be shared.
It's timeless advice: Go where your customers are. And they are mobile. Whether you use geo-behavioral or geo-fencing, it's important to understand the difference between the two.
At Tremor Video, we know the jargon soup has got to stop. That's why we've embarked on a year-long campaign trying to get away from it. Instead, our aim is to raise the profile of the ad tech industry and elevate the conversation overall. When we are all speaking the same language, we can be sure we're focusing on solutions instead of snappy acronyms, delivering value to all players in the video ad ecosystem.