The Candid Voice in Retail Technology: Objective Insights, Pragmatic Advice

Geo-fencing The Store

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At Shop.org a couple weeks ago, if there was one trend that I saw consistently among solutions aimed at consumer mobile, it was the concept of geo-fencing. The down and dirty definition: creating a GPS or at least a cell-tower-triangulated barrier around a location, whereby crossing that barrier triggers some kind of action. In retailer terms, if you get within one mile of store, for example, a geo-fence might trigger a text message to your mobile phone with an offer to entice you into the store.

RSR recently completed an evaluation of retailers’ localized advertising capabilities, including a look at how localized their mobile advertising was. It was overall pretty dismal. While we only looked at four categories of retailers, the number of retailers who included a localized mobile call to action were pretty much slim-to-none. To think that these same retailers could be proactive enough to set up geo-fenced perimeters around local stores to provide some kind of triggered response (whether mass or localized), seems like something that lives a very long way from today.

It also feels very Minority Report-ish. I haven’t brought that movie up in a while, but the scene where Tom Cruise is running down a hallway and all these ads pop up (3D holographic of course. It’s the future we’re talking about) puts me very much in mind of what might happen to my phone should geo-fencing run rampant. I’m not saying that as a consumer I’d opt into every single geo-fencing alert, but I drive past enough of my favorite retailers on a daily basis that this level of interaction with them might get extremely annoying. What if you lived down the street from your local mall? You wouldn’t be able to participate, because just driving home from work would send your phone into a frenzy,

I’ve also had some interesting challenges in testing out some of these local, geo-driven apps. One app sucked my battery dry because it was pinging for GPS data incessantly (the vendor has since fixed that). Another one – fully available in the app store, and has been for a little while – is completely devoid of “real” retailers. There are indeed offers in their app. They just happen to be “test” offers to show shoppers and retailers what they could potentially be missing.

Then there is MAD geo-fencing. MAD as in mutually assured destruction (yes, I was once a political science major). One vendor at Shop.org mentioned that they had had retailers inquire about geo-fencing not their own stores, but their competitors’ stores – so that as you neared the competitor, you got a text message with an offer for the retailer down the street. So take all of those pinging offers that come from the retailer you drive past, and multiply it times its top three competitors – now you’re getting four offers every time you approach a store, one to lure you in and three to entice you away.

I’m not saying that geo-fencing is a bad idea. But I will drag out a similar whine that I have issued about certain in-store technologies: What’s really in it for the customer? “I’m alerting them to promotions they will want and love!” is not a valid answer. Why? First, because the odds that you really know what that particular customer knows and loves as she walks up to your store on that particular day are pretty small. Even in this day and age, a lot of retailers don’t really know who their individual customers are. So the offer you’re making is probably not going to be something directly relevant to that customer’s trip to that store as they walk through the door – I’m sorry. It’s spam. Second, promotions and offers are rapidly getting so overused that there isn’t really anything special about them. The only thing that is different about a geo-fenced message vs. the hundreds of retailer emails in the inbox and flyers in the mailbox is the relatively novel delivery method. Besides, you’ve already got her in the parking lot – is an offer at this point an enticement or just a cooler way to give away margin? (By the way, with hands-free laws what they are and are becoming, pinging them as they drive by isn’t really going to help you out – unless you want to cause an accident for your customer, or win them a traffic ticket.)

So how can geo-fencing be used to actually help a customer? I can think of a couple: a reminder to check-in via social media, for one. I actually think social check-in is kind of fun, and it’s an easy way to make people think I’m actually using Facebook regularly. But I can never remember to check in anywhere, and retailers are pretty bad about putting up even the silly little foursquare or Shopkick decal in their windows. So that might be helpful to a shopper. A ping offering the retailer’s mobile app might remind shoppers that they have additional help at hand while they’re walking through the store – or guide people who don’t have the app to download it. A ping offering free WiFi would also be pretty worthwhile, and maybe, just maybe, something that offers recipes in a grocery store context (“Don’t know what’s for dinner? We can help – click here!”). Maybe these ideas are lame. But they’re certainly a step above slinging offers at any cell phone that a retailer can get its hands on.

At least they’re approaching the capability from the customer’s point of view – “How can you, Mr. Retailer, help me?” as opposed to “How can I help you sell more stuff?”

Newsletter Articles September 27, 2011
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