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The rise of the smartphone

Smartphones are one of the single largest drivers for e-commerce; constantly connecting consumers to a digital and globalized marketplace. These outlets present a large challenge for physical retailers as they operate with no restriction on trading hours and learn more about your behavior and purchase habits than thought possible.

By 2025, more than ten percent of all retail sales in the United States is expected to be generated via mobile commerce (Statista). 

The challenge of competing against the virtual store-front has led bricks-and-mortar retail businesses to adopt existing digital practices, however, now adapted to the physical world. One such is the application of location-based analytics and proximity marketing. This practice isn’t uncommon, notably, a driver behind the predictive capacities of Google Search Engine Marketing and Facebook Advertising. Whereby your location data is used in conjunction with other data sources to determine relevant advertising.

So what is location-based analytics?

Location-based analytics can involve varying data sources – CCTV, Wi-Fi and GPS just to list a few. Each provides a feed of data that can work in isolation or collaboratively to deliver aggregated reports on Picture of travel pathsthe behavior of consumers in-venue – indicating dwell in locations or travel paths. The level of detail depends on its application and requirements.

Creating this level of analytical reporting with WiFi is not as straightforward when compared to its counterparts of CCTV and GPS. WiFi location-based analytics requires specific capabilities in the infrastructure, provided by vendors such as, Aruba, Cisco Meraki and Ruckus.

What are the benefits of Location-based Analytics?

The practice of recording and reporting on the location of devices has several applications. The most common is providing a better experience, service or outcome to those whose devices it records.

From an operational standpoint, the use of location-based analytics allows organizations to make informed decisions around maintenance and development of public spaces, venues and facilities. They can better align with a clear understanding of human behavior and an ability to correlate these actions with outcome.

In a retail application, location-based analytics plays a large role in supporting and developing an understanding of customer behavior, similar to those mentioned by e-commerce. The use of these services allows retail venues to clearly identify shopper fidelity amongst precincts in venue, with an ability to marry these findings against shopper profiles. By collecting and aggregating this information, it acts as a powerful segmentation tool to power marketing campaigns that are contextualized and personalized to the interests of the consumer. Not to dissimilar to the digital practices used for analyzing a consumer’s digital behavior for advertising purposes.

Tools such as IO Engage take this digital application and apply it to a physical venue. To turn this information into actionable insights, establish a clearly defined segment of engaged consumers based on their behavior. As result, this enables the delivery of marketing campaigns that are relevant to consumer interests, and accurately measured back to spend and visitation to store, for a true ROI. This is an example of how to take the principals of data-driven marketing and replicate them for the physical world.