How to Market Using Restaurant Geofencing

What’s the deal with geofencing? What even is geofencing? Specifically, what is restaurant geofencing and how can you use it to your advantage? That’s plenty of questions already, so let’s back up a little. When it comes to marketing your restaurant, there’s not a “one-size-fits-all” method. Imagine being able to connect with the people in your area who would most likely pay a visit? We’ll get into that and more in our handy guide to restaurant geofencing. 

Restaurant Geofencing: Defined

Let’s start with the basics. What is restaurant geofencing? In short, geofencing is a location-based service where an app or other software program uses radio frequency identification (RFID), Wi-Fi, GPS, or data from a cellular device to trigger a targeted marketing action– a text, email, or push notification– when a device or tag moves through a “geofence” or virtual geographic boundary.

Let’s look at an example. Rachel is walking through the mall. She’s trying to find a baby shower gift for her best friend. At a loss, she consults her phone, which is incredibly common for 66% of Americans. As she passes Bath and Body Works, she gets a push notification about “saving 20% off select three-wick candles.” This is an example of geofencing in action. If it wasn’t clear, geofencing is a multi-channel marketing strategy. You can use it on social media too. If you’re a Snapchat user, you will notice that as you travel, you will have access to different filters for your stories. Users can also customize their geofilters on Snapchat for specific events including weddings and birthdays. This is a type of geofencing because you can choose the area that the geofilter covers. Pay attention to different cities next time you travel and see how your filters change! You’re right in the middle of a geofencing initiative.

When it comes to other social media platforms –i.e. Twitter, Facebook, and Instagram; you can set a geographic location for customers to see your ads in specific locations and places. Now imagine using this for your restaurant. As customers walk by, you have an assortment of tools, from Facebook ads to email marketing to grab their attention when they’re close by. 

Let’s Talk Terms

As you’re diving into restaurant geofencing marketing, let’s talk terms. Not terms and conditions, but the vocabulary words and phrases that you’ll see about geofencing. 

• Geotargeting – Geotargeting delivers ads to people that meet set targeting criteria while inside a defined location radius. This differs from geofencing because it targets specific consumer criteria including demographics, customer behavior, and keywords. Not only that but geotargeting can exclude people in certain locations. 
• Beaconing –  Beacons specifically target mobile devices based on their location. Whereas, geofencing targets any mobile device within a preset digital boundary. 
• Geo-framing – Essentially, this is best used to target users that have been in a specific location often. An example would be this is a strategy used to cross-sell, create repeat customers, or draw visitors back in on a strategic sales push. 

Is Restaurant Geofencing Right For You?

Now that we have some of the basic terminologies out of the way, let’s explore how can restaurant geofencing benefit your business. 

The Pros of Restaurant Geofencing

• Personalization – Geofencing lets you stand out in a noisy industry by personalizing ads to your guests based on the locations that they frequent the most. If they often visit your restaurant or the area around it, it’s beneficial for you to let them know when the menu has changed or when there is a daily or seasonal special available. On the other side of that, the data from your geofencing efforts can allow you to create customizable content that will apply to those customers.
• You’re more likely to reach your ideal customers – This benefit is two-fold. With a smaller geofence perimeter, you can target customers that frequent the area around a specific spot, which means they have already invested customers, thus not casting too large of a net. On the other side, since they are regulars, they are more likely to take action with your ads and drive conversions. Plus, you can send them ads on initiatives that are happening in real-time!
• Geofencing also offers a competitive advantage – These companies successfully used geofencing initiatives to beat out their competition:
  • Sephora
  • Whole Foods
  • Burger King
• It’s not as expensive as you think – Geofencing can make your spending more dedicated in certain places. If you already use Google AdWords or Facebook Ads, the cost is comparable. There might even be a chance that you’re already using a marketing tool that will enable you to set up geofencing including Google AdWords, Facebook, Instagram, and Snapchat!
  • There’s not a learning curve when it comes to spending on these types of ads either. These costs are rated as Cost-Per-Impression (CPM), Cost-Per-Click (CPC), or Cost-Per-Mille (CPM).

Need a little more convincing? Check out some stats below that may help: 

• The geofencing industry is expected to increase by 27% by 2022.
• Geofencing is compatible with 92% of smartphones and devices.
• 90% of SMS messages are read within the first three minutes they are received.
• Over 70% of consumers prefer a personalized ad experience.
• The majority of Americans own a smartphone.

The Cons of Restaurant Geofencing

• There are privacy concerns – As with anything considered “big tech,” there are always going to be concerns around privacy. Give your customers an option to opt out of these geofencing pushes. Don’t be too spammy. Send out ads at high traffic times for the best conversion rates.
• Right time, right place – The success of your restaurant geofencing campaign depends on the guest’s decision-making process. The goal is to get the customer to either “impulse buy” or interrupt their buying process with the notification or marketing action. With other advertising efforts, there is the risk of no conversion. 
• Apps – In most cases, your customer needs the app for your business for location-based marketing. Once the customer goes into the app, they will see the deal based on their location. From the app, they will be notified of the specials and taken to the landing location. 

How Does It Work? 

Without getting too deep in the weeds here, we wanted to provide a high-level rundown of how restaurant geofencing works. 

First, do you have a restaurant app? To get the most out of your restaurant geofencing efforts, you need to have a consumer-facing app. Your audience needs to be able to download the app on their mobile device and that way they can enter and exit the designated virtual location. 

Once you have a downloadable app, you can start implementing your efforts. Geofencing software may be your best bet and fortunately, you have a variety of options. 

Set your goals, whether long-term or short-term, for your restaurant geofencing initiative, then set your budget. To test this out, we recommend an initiative leading up to a holiday or an event and analyzing the data that you receive from it. Once you’re ready to launch geofencing as part of your digital marketing efforts, pick the software that’s right for you and follow these general steps: 

• Set up your boundaries – While this is great life advice in general, it’s important here in establishing exactly the perimeters of your geo-fence.
• Establish your actions – Decide which action is going to be triggered when mobile devices enter your boundary.
• Determine where customers are directed – Once people click on the action (SMS, email, or in-app targeting), where does it take them?
  • Create a custom landing page or form for your customers to go when they click on the ad (this can be created in the software you use).
• Your software can also track your data – You can check whether your geofencing campaign was successful. This is excellent data if you are tracking your restaurant KPIs, which can better inform your future decision-making.

Before we conclude, consider the following:

• Make the size of your virtual boundary realistic – The size of your geofence is up to you, as different platforms have different range limitations. However, make sure that the size of your virtual boundary is realistic. Casting a wide net sounds ideal, but you want to make sure that you are gaining customers that will continue to patronize your business. 
• Develop a clear call to action – Similar to most ads, catch attention by setting clear expectations. When a customer receives the email or notification what do you want them to do? Be clear in your language. 
• Say no thank you to spam – Don’t be that company. Too many notifications can turn off customers and make them unsubscribe from notifications in the future or make them delete your app entirely. 
• Do your research – Personalize your advertisements to your audience. Make sure you know who your audience is and what will make them come into your restaurant and try your food if they’re visiting. 

Restaurant Geofencing Conclusion: It’s Up to You

As with any new marketing strategy, it’s important to carefully measure your options. Each business is unique and while you can apply some strategies, there’s no one “right” way or guidebook to success. Consider your goals, budget, location, community, and other factors to put your marketing strategies and efforts to the most use. If you think restaurant geofencing will work for your business, run some tests first. Try out a small campaign during a holiday weekend or other traditionally busy time. Collect that data, see if anything needs to improve, and build from there. You know what’s best for your business. Let us know below which marketing strategies you’ve tried and what has worked for you. 

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About the Author

Devyn Nance is the Marketing Coordinator at QSR Automations. She graduated from the University of Louisville with a bachelor’s degree in Communication and from Loyola University Chicago with a master’s degree in Global Strategic Communication. She considers herself an (amateur) profiler – trained solely from watching every episode of Criminal Minds. Outside of work, Devyn loves to shop, travel, hang out with friends and family, read, and watch shows on various streaming platforms.