Geofencing for Real Estate: Why Location Based Targeting Works in Real Estate
Geofencing is one of today’s controversial marketing discoveries. And rightly, because it creates a sort of privacy breach. Privacy breach, which has been a subject of high profile court cases as of late. Primarily, any technology that allows you to create a fence around a particular area and target users within those constraints uses geofencing. In actuality, a technology that had been used to monitor and track moving vehicles for a long time has now been enhanced to keep tabs on prospects. Sounds creepy but its great news for real estate where location targeting is paramount. Without talking about the pros and cons, geofencing is set to grow as a marketing tool in coming years.
Global Markets released a report in January 2018 that assessed the growth and potentialities of geofencing as an Industry. According to the report, increased penetration of mobile devices and the rising prominence of location targeting among marketers will lead to a compound annual growth rate of 28% from 2017 to 2024 in the geofencing markets.
A lot of real estate agents who can’t leverage this type of technology waste marketing dollars pitching the wrong leads.
And agents who can effectively use targeting tools get better conversions. Increasingly, new tools are being discovered to target prospects by net worth, demographics and most especially, location.
While geofencing isn’t mainstream yet for many real estate brokerages, when used right, it can be a potent tool for connecting with local leads.
How Geofencing Works
An app or software utilizes location tools like GPS, WiFi, RFID or cellular data to enforce a pre-programmed action whenever a cellphone enters a specific location. For instance, when a prospect’s phone comes close to your office, they are served an ad or offer from you. The most common type of geofencing advertising is delivered via push notifications, where a user gets a notification once they approach your service area if their phone’s location monitoring is switched on.
Geofencing ads can also be sent via text messages, alerts or social media once a geographic area is defined to an accuracy of 100-200 meters. The fact that they don’t need permission from a user before delivering information makes them seem invasive. Hence before employing geofencing ads, ensure to check state laws as regards location-based advertising.
Why use Geofencing for real estate?
1. Target people by location. Geofencing lets you reach users who live in particular areas instead of running generic ads. You can optimize your message for them and figure out a marketing strategy based on your prospects’ location data.
The improved GPS accuracy of most mobile phones enable marketers to determine a prospect’s location more accurately. This guarantees that the leads generated are high-quality leads.
2. Personalize your Marketing. You sidestep random ads that many people find irrelevant for more personalized offers. 71% of consumers love personalized marketing experiences. As a real estate agent for example, when someone comes close to one of your listings, you could display a short carousel ad showing the best views of the property.
3. Compete aggressively. Geofencing ads allow you to send ads to your competitor’s customers. For example, when someone visits your competitor’s location, they might be served a tempting offer from you. This is not an ‘ethical practice’ but it can be effective.
4. Analyze customer purchase trends. What kind of ads or offers appeal to people in a particular location? With the right information, you’ll segment your ads more effectively and reach people that would be more valuable to your business. You’ll gather more accurate buyer persona data to help your marketing efforts.
5. Automate lead generation. You don’t need to individually send ads to prospects. You might be away from the office, your geofencing ads would still get delivered to anyone entering your fence area. This ensures new lead generation opportunities are not lost.
How to generate real estate leads with geofencing
The concept of geofencing in its basic form means you are targeting users or prospects based on location. And some social media apps already allow you to do this. For example, Facebook ads geolocation feature or Snapchat geofilters.
But aside from social media, there are applications that deliver geotargeted or geofencing ads, for example, LocalPagePop. Your display ad can be any of the following:
- Targeted video: A very short 10-30 seconds video clip showing the best views of one of your recent listings. This is a good idea since video ads have the best conversions.
- Community promotions: When a buyer enters your fence area, you can deliver a customized welcome message that subtly features your brand name and logo.
- Offer promotions: Are you running an offer, why not serve up your new offer to people in your competitor’s location?
- Amenities: Are you trying to get people’s attention to a condo listing? You can feature the amenities you offer, for example, gym, pool, spa, etc.
- Leverage contextual location-based data: You can serve up useful information to help home sellers in your location looking to sell in winter. Or feature testimonials from some of your past clients in the neighborhood.
- Use interactive ads: Interactive ads capture people’s attention by asking a specific question. And then looks to meet the need. For example, a question like what feature is most important to you in your next house? Once a prospect enters an answer, you serve them with potential houses that probably have the feature they seek.
Beacons work on the same idea as geofencing. The slight difference is that the target radius is much smaller. They can be used to display location-based messages or display special features to people who visit your open houses. Brightdoor, a provider of beacon technology provides a good illustration of the application of beacons in real estate.
Geofencing is set to grow massively in the next few years as 77% of Americans now own a smartphone, up from just 35% in 2011. Brokerages that can employ this early on and strike when the iron is hot would gain the advantage. It is an effective form of marketing because prospects are not reached haphazardly but targeted with personalized messages to deliver high ROI. Yet since there is a potential for these unsolicited ads to infringe on people’s privacy, you need to check your state’s location-based marketing rules.