Proximity marketing meets loyalty programs to supercharge the retail experience

What is proximity marketing?

Proximity marketing uses technology to connect with existing and potential customers. Also known as ‘geolocation targeting’, this tech tool uses customers' locations to deliver relevant messages. For example, businesses can target users based on how close they are to a store. This is useful for retailers with physical locations who want to reach nearby customers at the right time. 
 

Proximity marketing is also a powerful tool for loyalty programs. Businesses can use the data collected via a loyalty program to tailor messaging based on what they know about a user - their location, behaviour, preferences, etc. - and deliver messages only when it’s most effective. 

How can you use proximity-based marketing?

Depending on your business and goals, ‘geomarketing’ can be used for one-time promotions or an ongoing engagement campaign. For example, a beer company might offer a discount to customers who order drinks from a certain area where they expect high demand (such as near a sporting event). A clothing store might send push notifications to customers that have recently visited, inviting them back for an upcoming sale. Hotel chains could offer a free breakfast for guests that check in at specific hotels during slower travel periods - helping to drive traffic at times when business is slower than usual. 

Geolocation marketing can also be used to encourage repeat visits by sending discounts to customers who haven't visited your store recently (at risk of churning). The offer could be for something specific that would entice them back into the store (e.g. 15% off your next purchase if you return within two weeks).

How to incorporate proximity marketing tools into a loyalty program

To use proximity marketing in your loyalty program, start by creating a list of all the different ways that customers can interact with your brand. Then, think about how these interactions could trigger a message or notification from your app or website. Note down all the possibilities!
 

Next, use customer data to identify different segments of your audience. For example, a clothing retailer may want to identify all customers who play sports and have made a one-time purchase in-store. Then, the business can send a notification for a discount on sportswear when these customers are within 5 miles of a store. The customers’ location triggers a promotion or reward to encourage them to make a purchase. 

How geolocation works: more examples and ideas 

There are a lot of ways to incorporate proximity marketing solutions into a loyalty program. Here are a few more ideas:
 

• Offer exclusive rewards when the customer is near. For example, a coffee shop might offer a free drink with every food order when a customer is within 100 meters of their location. Make this offer even more irresistible by giving it a time limit - “2 hours left to get free coffee with your lunch”. 
   
• Let customers know about events happening nearby. When you know a customer is in London for the day, send them an email or text notification to let them know about your pop-up shop or in-store event. 
   
• You can even reward customers who are already in your store. Give customers who enter your store a QR code to scan at the register to receive a free gift with their purchase. 
   

Innovative retailers are showing us what the future of shopping could look like

Let’s take a look at some of the ways big brands have incorporated proximity marketing…
 

• Nordstrom

This retail brand successfully connects the offline and online worlds with proximity marketing. Nordstrom will send an app notification to a customer when their desired product is available in a nearby store. This is particularly useful for customers who prefer to see products in-person before making the decision to buy. 

• Carrefour

The multinational retailer has used proximity marketing tools in all of its 28 stores in Romania. Carrefour’s geolocation-enabled app collects data about in-store activity. The company is able to use this data to create marketing campaigns that keep customers up to date with new products, services, offers, and discounts. After implementing geolocation, Carrefour saw a 400% increase in user engagement rates. 
 

• Burger King

The fast food giant delivered a memorable campaign when they offered a Whopper for just 1 cent. But only if you are nearby a McDonald’s…

This bold marketing strategy used geolocation targeting to offer app users a 1-cent deal when they are within 600 feet of McDonald’s: “not only does the app allow customers to grab a deal, it also directs customers to the closest Burger King, detouring them away from McDonald’s to pick up their burger”. 

Why should I use proximity marketing in my loyalty program?

Put simply, proximity marketing leverages customer data to drive better engagement in stores. Brands are fighting for meaningful engagement with customers, and traditional loyalty programs have lost traction. With a geolocation-enabled loyalty app, you can reward customers for visiting your stores and target them at the perfect moment for truly impactful campaigns. 

The future of loyalty is location-based marketing and rewards

The growth of online shopping may threaten physical retail stores. But more than half of customers prefer to see, touch, and test a product before buying. This is why retailers must create a valuable in-store experience. 
 

Did you know? Location-based marketing is predicted to grow to $101 billion by 2027. 

At White Label Loyalty, we want to make shopping personal again. Your store is more than just a store - it’s an experience. When it comes to creating brand loyalty in a retail environment, an intelligent loyalty program that uses proximity marketing is your secret weapon. Know if a customer is new, a loyal shopper, or has never visited your store before and deliver them tailored marketing messages. To make the physical retail experience highly engaging, reward your customers with exclusive offers and discounts when they are nearby.