Remember that pop-up ad telling you to grab a meal from your nearest cafe during lunch hours? Or that one notification pulling you in with the same-day delivery service? How about that one ad showing you all the fun you can have at this music festival just next town?
From popping up at the right time, in the right place, and during the right situation, these location-based ads have taken the advertising industry by storm.
And before you freak out, no, these brands aren’t keeping tabs on you. It’s just your GPS and IP addresses doing the trick to serve the most tailored ads. Businesses, especially brick-and-mortar stores, have now started using location-based targeting to reach users who can easily walk into their stores. But they’re not the only ones doing it. Even online businesses are adopting this feature to better target and personalize their ads.
Drive More Sales with Geo-Targeted Ads – Try It Today!
How, exactly? And can you use it? Keep on reading this blog to find out.
Location-Based Targeting: Where’s Your Audience
Location-based targeting is a digital marketing technique that delivers ads to people based on their physical location. Advertisers can target people based on specific locations, cities, and countries or those who have shown an interest in a particular location. Many advertising networks will even allow you to target depending on the radius or nearness to the physical store.
Frankly speaking, such location-based targeting isn’t anything new. Earlier, businesses used to spend on finding the topmost relevant spots for their billboards and posters; or advertise with local news and radio channels. You would see posters for a coffee shop just outside the alleyway where it’s located. And if there’s a big departmental store launch, you’ll find big billboards in the most crowded locations.
But ever since every hand got a mobile phone and access to online, this approach has shifted significantly. Location-based advertising is now delivered through mobile apps and programmatic advertising. GPS coordinates and IP addresses come into play to determine a user’s location and then serve ads from businesses that have targeted the location the user is at.
Statistics to Remember
The impact location-based targeting has had in the real world can be felt through the success of advertising campaigns. But here are a few statistics to further show you how much of a driving force it is for most marketers.
As per reports by Future Marketing Insights, the global sales of location-based marketing services were recorded to be 59.7 billion USD in 2024. This is projected to see an increase in 2025, with the sales reaching a worth of 69.0 billion USD in 2025. This increase is majorly due to the integration of the newest technologies, such as AI (Artificial Intelligence) and ML (Machine Learning), that contribute towards accurate targeting across various GEOs.
Another report by Factual states that almost 9 in 10 marketers said that location-based advertising and marketing resulted in higher sales, followed by 86% growth in their customer base and 84% increase in customer engagement. Since they are able to serve more personalized campaigns, engagement and customers naturally follow.
Dynamic Role of Location-Based Targeting
You’re wrong if you think location-based targeting can only be used by physical stores that require foot traffic. It’s a dynamic feature that has multiple roles and serves multiple types of businesses. Here’s a list of a few:
- To spread awareness about your physical store and drive more traffic visits to it.
- To target people for localized events and spread promotional offers.
- To target high-converting GEOs where your audience is the most active, resulting in higher engagement and conversions.
- To run custom promotional offers in different neighborhoods.
- To segment the audience based on locations and carry out further personalization.
- To localize brand messaging using cultural values and local language.
- To tap into a brand new market to expand customer growth.
- To save your budget and reach an improved ROI by only spending on areas that will reap results.
Honestly? It’s totally up to you what you can make of this feature. Just make sure not to rely on it alone for your as it is based on a variety of signals, including the user’s device and browser settings. Although ad networks try their best, there’s no 100% accuracy.
Types of Location-Based Targeting
There’s not one, not two, but plenty of ways in which you can utilize the location data for targeting.
Geofencing- draw a fence
As the name suggests, geofencing includes drawing a virtual fence around a specific location that you want to target. This location can either be a specific store, an establishment, a neighborhood, or even an entire city. Advertisers will then use latitude and longitude coordinates to run their ads only within this fence. The ad will get triggered whenever a user enters this fence and will be displayed to them via display, popup, search, or in-page push ads.
Since 96% of mobile devices are compatible with geofencing, these ads are likely to reach a large audience. They are a perfect fit for brick-and-mortar stores or when you want to appeal to a broad group of demographics.
- The brand that did it right: Starbucks, Starbucks uses multiple geofenced apps to drive people to the store. They send push notifications, along with irresistible offers, to users who walk by their outlets or are in nearby areas. A message like ‘You are near Starbucks Oxford st. Currently 50% off on your favorite drink: Vanilla Latte.’ is good enough to make you stop by your favorite coffee shop to get your favorite drink.
Geotargeting- single out areas
Geotargeting is for when you want to focus on demographics, interests, and behavior; along with location. This type of location-based targeting is more detailed, thereby reaching a smaller but more relevant group of audiences. These ads work best when your products or services are for a niche group of people and need to be personalized for them.
- The brand that did it right: Ulta Beauty, Ulta Beauty, the famous cosmetics and fragrance brand, used geotargeting to attract more customers to their new store openings. They targeted smartphone users who were in close proximity to their store, had an interest in beauty and makeup products, were interested in learning about new stores, or were near their competitor stores. This resulted in many of their stores reaching their weekly visitation targets 37% faster.
Geoconquesting- tiptoe around competitors
Geoconquesting is when you tiptoe around your competitors and display your ad whenever a potential customer enters the proximity of your competitors’ store. It’s a great technique to divert foot traffic to your store. You’ll find success if the offer you’re making is strong enough as the person is already (most probably) in the product/service you offer.
However, the downside here is that if done wrong, you might come off as a bit creepy, further damaging your image in front of the user.
- The brand that did it right: Hyundai, Hyundai cars have always been affordable, but a few years ago, the brand faced a new dilemma: their cars got a reputation of being ‘cheap’. To handle this negative imagery, Hyundai came up with the campaign codenamed ‘dealer stealer’, wherein they mapped down dealerships of two of their biggest competitors across Australia: Mazda and Toyota. When smartphone users went near these showrooms, a Hyundai ad would be directly delivered to them.
Weather Targeting
One of the recent trends we’re seeing most advertisers hop onto is weather targeting. Weather targeting activates relevant hyperlocal ads that connect with consumers based on what the current or forecasted weather signals are. People love to go out and eat when the days are sunny but prefer home deliveries when the weather turns gloomy or rainy. Advertisers have figured this out and make use of every change of weather to churn out personalized ads.
- The brand that did it right: GruberGreets, GruberGreets, the food delivery app, sends push notifications for free deliveries to every target customer who lives within a certain range of dull, cold, or rainy weather. When messages like ‘Why go out when you could order in? Stay out of the cold with free delivery, today only.’ pop up at such relevant times they are hard to miss.
Proximity Targeting- define your radius
Proximity Targeting is when you reach smartphone users when they are around your store location or near a point of interest. You define this proximity by setting up an approximate radius of distance around a certain location. When a user enters this radius proximity, it will trigger your advertisement and convey the message to influence their behavior.
- The brand that did it right: Coca-Cola, Coca-Cola’s ‘Share a Coke’ campaign was highly based on proximity targeting. The beverage company used beacon technology to send personalized messages to nearby shoppers. Whenever shoppers walk by a vending machine, they receive a push notification with the message ‘Feeling Thirsty? Grab a Coke nearby!’
How to Launch Location-Based Targeting Ads
Location-based targeting can backfire if you don’t play the steps right. Here’s everything you need to follow.
Do Audience Research
The first step is to determine if your audience can actually be reached through targeting-based campaigns. Start creating their profile by understanding what their current location is, where they reside, and how they move and behave in real life. Refer to past analytics and third-party data to see where they are most active and engaged with your type of business. Analyze their demographics, interests, and online behaviors as well to get an overall view of how you can improve ad viewability.
Do Market Research
The next step is to perform market research and see what type of location-based targeting would work best with your audience and market. If you have a brick-and-mortar store, then proximity marketing and geofencing will be great options. But if you have an online store, then geotargeting might be a better option.
Craft Personalized Messaging
After performing market and audience research comes crafting personalized messages for each audience group. Start by gathering a user’s geographic data and analyzing it to find things like local events, relevant product recommendations, cultural and language variations, and lifestyle. Tailor your ads to them by incorporating localized content that would feel more targeted and catered toward them.
For instance, you can:
- showcase available stock levels based on regional preferences
- serve to their relevant climate, weather, and lifestyle
- craft localized experiences and stories that the audience can better relate to
- provide social proof related to the region
- collaborate with communities
- use location-based labels like ‘popular in your area’ or ‘store near you’
But keep in mind not to come off as stalkerish. Make it look like you’re a friend who just met them at the local market.
Launch and Optimize
Now that all your ad creatives are done, it’s time to set them up for launch. Choose an advertising platform with advanced location-based targeting options to make your targeting more effective. Opt for countries, regions, or areas where your target audience resides. Stay updated with all the state rules and regulations to avoid any mishaps. For example, don’t risk targeting your iGaming website to countries where it is banned.
Reach the Right Audience at the Right Place – Join Today!
Once done, launch your campaigns and keep an eye on them as they are live. See the response your campaign receives by tracking impressions, clicks, and conversions. A/B test other locations and GEOs and optimize your strategy based on new trends, products, and previous campaign data. Change the target settings while your campaign is still live to avoid starting from scratch. You can check out ad networks like 7Search PPC, which give you robust location-based targeting options.
Conclusion
In a time where competition makes it hard to reach your customers, location-based targeting stands out as an effective approach. Not only does it work for local businesses, but is also a valuable asset for global businesses. Whether it’s targeting users based only on their location, aligning it with their demographics, adding in the weather, borrowing customers from your competitors, or using radius to advertise only to a certain area- location-based targeting does it all. You can easily skim over the crowded routes and jump in front of users who will be most valuable to you.
Frequently Asked Questions (FAQs)
What is location targeting?
Ans. Location-based targeting is a strategy that uses a user’s geographic data to serve them ads. Advertisers can select GEOs or regions where they want to show their ads.
What are the effects of location-based marketing?
Ans. Location-based marketing can help you better reach your customers, minimize ad spend by targeting only the relevant customers, and drive more in-store traffic.
Are there any challenges to location-based marketing?
Ans. Yes, location-based targeting has some challenges, including privacy and consent concerns, respecting user privacy, and striking a balance between coming off as supportive or stalkerish.
What are the different types of location-based targeting?
Ans. Location-based targeting can include a variety of forms, including geotargeting, geofencing, geoconquesting, weather targeting, and proximity targeting. When to use which strategy depends on where your audience resides and what your budget is.
What is an example of geotargeting?
Ans. Geotargeting makes use of both geographic and demographic data of the audience base to target users. For example, a new beauty retailer targeting only women of the city in which they are located.
