The seeming ubiquity of e-commerce—the ability to buy anything, from anywhere, at any time—with the simple click of a button masks a very contrarian reality. It doesn’t happen that much, most shopping is local.
In fact, 80 percent of consumers’ disposable income is (still) spent on businesses within 10 miles of their homes, or maybe a 14-minute drive. While all the innovation, attention and marketing outlays are focused on online retail, the hard truth is that most of us still like to make our purchases in person. Even the largest online retailers are essentially competing against local merchants, rather than just the other way around.
This is why online marketing needs to be hyperlocalized, and it isn’t. Beyond the obvious parameters—city limits, zip code, statewide, etc.—there’s no quantifiable metric and scalable methodology to ensure that online advertising reaches consumers at a truly granular level. Of course, non-specific targeting leads to low conversion rates, also known as a waste of money. So, while the much-derided direct marketing model has successfully reached consumers on a 1:1 basis for decades, the most sophisticated digital alternatives still fall far short of that goal.
But, we’re getting there. IP geolocation technologies now enable marketers to significantly enhance their ability to reach customers using both business type and consumer location data. By knowing precisely where someone is going online, along with their connection speed, brands can target audience segments based on business-type level, reaching customers online in ways that were previously possible only through direct mail and billboards.
For the record, this is not some Big Brother tactic: IP geolocation technologies and methodologies provide relevant information about individuals online specifically without infringing upon any privacy concerns. No cookies are dropped, no personally identifiable information is pulled, and no web history data is extracted. Marketers get only the location information they need, and that’s it.
Local targeting through IP geolocation gives merchants the tools they need to get information for discount coupons, online deals, banner ads. It’s about getting the right products, in front of the right shoppers, at the right time, where they are. At the same time, it allows marketers to more efficiently integrate online and offline campaigns at the local level.
The benefits here are undeniable. Hyperlocalized marketing enables more relevant messaging and increasing customer engagement and conversion with each campaign. Better ads increase offline and online traffic, conversion and sales by automatically personalizing merchandise assortments by location. The ability powers local search and discovery.
There used to be a joke at ad agencies nationwide that half of all advertising is wasted, but no one knows which half that is. The ability to geotarget ads takes away much of that punchline. But the option is good for consumers too—they only see ads that are relevant to them, while still ensuring their privacy. And a steep drop in spam alone makes the practice worthwhile.