Location intelligence is a new hot topic in the business intelligence software community.
The location analytics market is estimated to be worth 16.34 billion dollars by 2021. For those who can incorporate it into their business intelligence strategy and use it successfully, the prospects are immense.
But what’s so special about location data?
Location, in some form or another, has long been part of business intelligence. Businesses used to collect customers’ zip codes, cities, and countries, with surveys, or more recently, IP addresses. Location intelligence, however, is the next step.
The prevalence of smartphones, and the explosion of various location services, gives companies access to a new kind of data—dynamic location data. Since mobile devices constantly move around, they generate more data about customers’ whereabouts—the businesses they visit, how often they visit them, and even how long they stay there.
Commonly, dynamic location data is collected with the help of location services, such as geofencing and proximity beacons. A geofence is a virtual perimeter set arbitrarily around a city or a store. People carrying smartphones and equipped with appropriate apps get logged entering and exiting certain areas. A beacon is a small device that detects a smartphone on a smaller scale, for example, in a certain aisle of store or at a certain tent of a venue.
But retail locations aren’t the only sort of businesses that can benefit from location analytics. In this post, I’ll tell you what other kinds of businesses can benefit from location analytics, and how this new technology can improve your marketing. I’ll help you figure out if location analytics is right for you by looking at how it benefits you, and your customers.
Why should you add location intelligence to your BI today?
1. Location intelligence is the future
People were surprised when Amazon bought Whole Foods earlier this year. But according to location specialists, the newest acquisition has little to do with food retail and a lot with acquiring precious data on regional consumer habits and population density.
It’s likely a part of a wider scheme to optimize deliveries using proximity intelligence technology Amazon has been perfecting for a while.
Top players are setting an interesting trend here, and it might change the the shape of business strategy, and structure, in the future. Even if you’re not ready to jump on board with location intelligence, when all the big players make a move, it’s time to pay attention. As with a lot of trends, it eventually trickles down to the small business level.
2. Location intelligence is the missing piece in your customer journey
Ever since the introduction of digital marketing, it has been extremely hard for businesses to connect their online efforts to the physical actions of their consumers. Customers who received online promotions or browsed a mobile app and eventually made in-store purchases would fall off the grid, inevitably leading to inaccurate ROI.
With92% of all commerce happening offline, knowing which of your marketing efforts drive foot traffic is key to distributing your marketing spend.
With location data, companies can close the long-standing gap in customer journey and follow the user all the way from a click in the app to a store visit. Not only will you be able to tell when a customer responds to an offer on their smartphone, you’ll be able to know when that smartphone gets close to your store.
Location insights combined with other data, such as profiles of your customers and their online habits, reveal other trends that could be groundbreaking for your business. Do your customers visit the brick-and-mortar location relatively soon after they click on an online offer? Does it take them longer? Do certain offers get them to the store, quicker? Location analytics can answer all these questions.
3. Location intelligence makes you relevant
One of biggest challenges for any business is information overload. Consumers see between 4,000 and 10,000 marketing messages on a daily basis, so they have grown accustomed to filtering anything irrelevant.
Advertising specialists agree that personalizing your ads and making them more relevant is a perfect way to build a loyal customer base and boost your profits, but data from 2016 shows that businesses have a difficult time adhering to the best practices in a competitive marketplace.
According to Hubspot’s annual marketing report, 91% of those surveyed find ads to be more intrusive than two years ago, 70% dislike mobile ads, and a staggering 419 million downloaded ad blocking apps, costing businesses $22 billion in lost revenue in 2015 alone. However, 77% of customers admit that they would rather filter than block ads.
Location intelligence gives your business another unprecedented advantage—context. Real-time geo-location makes your offers more relevant, and based on where your customers are. The engagement rates of media served based on location parameters are, in fact, a lot higher.
The same logic applies to push notifications, where location-based notifications perform two to three times better than generic notifications.
4. Location intelligence improves retargeting
Retargeting is another level of marketing that can bring in more revenue than your initial advertising campaigns.
It’s especially important for high-value purchases, where consumers need extra time to consider their decisions. Retargeting can make sure those customers see the offer again, later. And with location intelligence, you can anticipate a customer’s purchase intention and reach out to them before they actively look for you, or before your competitors make a move.
With geolocation, you can tag a client of yours when they visit your salon. You may also track when they check out your competitors. They’re searching for the best offers and making up their mind. It’s now up to you to make this decision easy for them by providing additional information they could find useful, or by gently reminding them about your offer.
5. Location intelligence amplifies your business intelligence
Location data can give you heat maps of urban density, routes preferred by your target audience, or trendy neighborhoods. Location insights combined with other data reveal other trends that could be groundbreaking for your business. For instance, is there a certain demographic less willing to brave the rain? If so, might want to save an offer for that group until things clear up.
Add that to your business intelligence data and you can take it straight to your investors, marketing teams, and sales reps. That’s the piece of information you need when deciding on the location of your stores, delivery routes, and venues for your events.
What’s your next step?
Geolocation data doesn’t exist in a vacuum. It needs the right software and analyses, as well as other data, before you can reach the right conclusions for your business. Like with any business intelligence tool, location intelligence is whatever you make of it.
But if Amazon’s experiences teaches us anything, it’s that used correctly, those tools give you an incredible upper hand to outsmart your competition. If you’re not using location intelligence in your BI yet, it’s time to get up to date.