Geofencing: How to Leverage Location-based Ads

Geofencing is one of the most underutilized paid media strategies. Marketers in any vertical can use targeted location-based ads to serve personalized creative and messaging to the right audience, whether that user is on the other side of the globe or walking by the front door.

What Is Geofencing?

Geofencing is delivering digital ads based on a customized geographical boundary, or fence, that can be set and fine-tuned. Ads are delivered to users when they enter the boundary. This stops when the user leaves.

The Biggest Location-based Ads Networks

Most publishers offer geofencing or at least some form of location targeting. Google Ads, Facebook and growing retail media networks allow marketers to adapt messaging and targeting to each platform. Location-based ads on Google and Facebook are limited to a radius around a specified location.

While Meta, Google, and LinkedIn don’t allow complex geofencing, there are a few lesser-known location targeting options available in Google that are geofencing-adjacent: airports, college campuses, congressional districts and IP addresses. Targeting by IP address is advanced; you must exclude all the IPv4 networks you do not want to see your ads.

If you need complex geofencing options, there are many third-party solutions that use mobile device data to personalize and scale ads.

Tip: The default radius setting is usually in miles. By using kilometers as the unit, you can target a smaller area.

How Does Geofencing Work?

Location-based ad networks use mobile device data from several sources:

• App-specific location data
• GPS data
• Wi-Fi data
• Cellular data sources
• IP addresses

Most of these sources rely on user permissions. Restrictions in browser and device privacy settings, made more common by companies like Apple, have reduced publishers’ ability to deliver ads based on physical locations. Additionally, we should note again that Google and Meta don’t offer intricate geofencing, just broader location targeting.

Despite these limitations, geofencing ads is an effective strategy for many businesses.

Location-based Ads in Action: Examples of Geofencing for Marketers

Multilocation organizations use geofencing ads to support locations and larger service areas. What these campaigns often lack is flexibility that improves ad spend efficiency and introduces personalized, localized messaging.

Recruiting ads – In a tight labor market, meeting staffing requirements is challenging enough for a single franchise location or independent storefront. For regional or national chains, recruiting may be a long-term barrier to growth, especially in sectors like hospitality and food service.

Make it personal: Introduce location-specific information to support hiring at specific stores or areas. Use local photography and city or region names. Consider handling at least some applications locally, even if your organization has centralized HR.

Flash promotions – The traditional method of managing inventory levels across a multilocation system is to move inventory between stores, including mass shipments of items to outlet centers. This expensive and time-consuming process still results in selling inventory at a lower margin, or a loss. Instead, support underperforming or over-inventoried locations with location-based flash promotions. This tactic mitigates time and costs, and positions stores to attract and retain customers.

Make it personal: Flash promotions introduce a sense of urgency. Double down on that response with exclusivity; explain that this deal is only available at a single location.

App-based geofencing – Companies with mobile apps have easy access to their customers. Brands like Starbucks and Burger King have had success with geofencing notifications to users near stores. With a simple ping! Starbucks offers a discount on the nearby customer’s favorite drink.

Make it personal: App notification marketing, like SMS and push notifications, is as personal as it gets. Don’t overdo it – consider adjusting notification settings based on foot traffic. You might only send those “$1 off a drink” notifications during slower times of the day or month.

Geofencing Explained: Getting Buy-In

Especially for marketers supporting multiple locations, it’s sometimes tough to get everyone on board with a geofencing strategy. Centralized ad management often means spreading the love evenly, supporting every location with the same budget and attention. Start the conversation with data and strong rationale, and stress that geofencing is just one element of a broader strategy. Here are a few ways to present that:

• Geofencing is only a certain percentage of total spend.
• Geofencing might be incentive- or need-based.
• Geofencing may be limited to supporting new locations.

Effective marketers use every tool in their toolkit and keep them all sharp. Invest time in testing and adapting location-based ads so you’re always ready to flip the switch!