Case Study: How a Luxury Dealership Won With Geofencing Marketing

Geofencinghelps reveal what is actually working and not working in driving traffic to your dealership

Imagine a world where you can target consumers actively shopping and visiting other car dealerships. With geofencing marketing technology, now you can.


Geofencing marketing allows for businesses to target their ads to people based on the physical places they go, such as buildings, malls, events, competitors’ dealerships, repair centers, and other locations with a large concentration of likely car shoppers.

What is geofencing?

Through the use of mobile GPS and app technology, businesses and advertisers can create a virtual geofence around a target building or area.

When consumers enter the designated area (with their smartphone location finder on), companies can capture the mobile device IDs and use that information to target their mobile phones with advertising while they are in the geofence—for up to the next 30 days after they leave the geofenced area.

These consumers will see those ads when using mobile apps such as Angry Birds, Weather.com, etc., or when they visit mobile-enabled websites that accept advertising.

Who should dealers target?

Dealerships are constantly looking for new ways to disrupt their own marketing budgets with forward-thinking solutions that drive measurable foot traffic to their showrooms.

According to Google, 71% of a car shopper’s interactions take place on a mobile device, making geofencing the ideal hyper-targeted advertising solution for dealers.

Here are three of the many uses of geofencing for dealerships:

  1. Competitor conquesting. Target your competitor dealerships when shoppers visit them.
  2. Customer loyalty. Geofence your own dealership to keep it top of mind or to offer additional incentives for customers who are currently shopping.
  3. Major local events. Target major events with a large number of people who may be potential vehicle buyers (like the annual new-car show or auto enthusiast gatherings).

Why geofencing is great for marketing

There’s an old saying that 50% of advertising works, but you don’t know which 50%. Geofencing, while not perfect, gets you a lot closer to knowing what is actually working and not working in driving traffic to your dealership.

Here’s what you can track with this proprietary advertising system:

  • How many times your ad was shown (impressions/ads served and seen by consumers).
  • How many people saw your ads and called your dealership.
  • How many people actually saw your ads and visited your dealership website (enabling measurement of how much it cost to drive each person to your website).
  • What geofenced locations are driving the most awareness and activity.
  • How many people actually saw your ads and visited your dealership (also enabling measurement of the cost to drive each person to your dealership), providing a truer ROI measurement of your advertising spend.

Case study: How a luxury dealership attracted 500 new customer prospects to its website

The following case study reveals how geotargeting enabled a luxury car dealership to attract 500 new customer prospects to its website and 132 prospects to its showroom.

A Volvo dealership in the New York Tri-State metro wanted to increase brand awareness among its target audience of luxury car buyers, and bring those prospective buyers into its showroom.

While leveraging geofencing marketing, the dealership and its marketing partner took these steps:

  • The dealership worked with the marketing partner’s team to develop custom creative assets (banner ads).
  • The marketing team built geofences around areas with a very high concentrations of car shoppers in the luxury market, including local competitive dealerships.
  • The marketing team set up a conversion zone around the actual dealership so it could successfully track customers who entered the established-target geofences and those who saw or clicked on the ads served, as well as those who actually visited the dealership’s showroom.
  • Along the way, the marketing partner and its team optimized the geofencing campaign, which included:
    • Running ads during the best-performing times of the day;
    • Eliminating low-performing apps and websites;
    • Testing the best-performing creative assets (turning off ads with low performance); and
    • Reallocating campaign budget to the geofences driving the most foot traffic to their dealership.

What was geofencing’s impact?

The dealership and marketing team gained the following results and information from the geotargeting campaign:

  • Over a 30-day campaign test period, the marketing team delivered over 300,000 impressions;
  • 500 clicks were driven to the website (exceeding click-through-rate industry norms by 50%);
  • The campaign drove a minimum of 132 people to the dealership;
  • The average cost per visit was approximately $21.
  • The marketing team was able to track the dealership’s natural foot traffic (people who did not see its ads and went through the target geofenced areas) compared to campaign advertising foot traffic (those who did see its ads and went through the target geofenced areas). While natural foot traffic averaged 0.5%, campaign advertising traffic averaged 1.20%, giving the dealership a 140% geo-conversion lift in foot traffic.

Overall, geofencing marketing offers a way for dealers to effectively spend their marketing dollars on building brand awareness. Most importantly, they reach people who have indicated they’re in the market to purchase a vehicle. And dealerships can do it in a way that drives additional foot traffic to their showrooms in an efficient, cost-effective manner.

Geofencing is not a replacement for dealership’s advertising budget, but it’s a great addition to the advertising mix.


Justin Croxton is the managing partner at Propellant Media, LLC, a digital marketing and media solutions provider, offering geofencing marketing and programmatic display solutions to auto dealerships, agencies, and companies. Visit us at www.propellant.media.

Justin Croxton

4 Comments

    • Avatar
      Steven Miller April 09, 2018

      Thank you Seth, but what you are describing in your article does not seem to be “real” geofancing based on GPS data (as far as I understand). It is just the regular targeting by Google and Facebook, as for example the lowest possible radius for Google Adwords is 1 KM.

      The question rather is: how can I build an audience for customers that move to a specific store (specific point on the map)? Therefore a radius of 0,05 KM or so would be necessary…

      Reply
      • Avatar
        Seth Winterer April 09, 2018

        Even with the lowest targeting option of 1KM, you can add geographical exclusions to enclose a location to get the targeting tighter than the 1KM min. The geotargeting options on FB and Google are based on actual user location information they agree to enable or not enable in the app or browser settings.

        Reply
  1. Avatar
    Steven Miller April 09, 2018

    Thank you Seth, but what you are describing in your article does not seem to be “real” geofancing based on GPS data (as far as I understand). It is just the regular targeting by Google and Facebook, as for example the lowest possible radius for Google Adwords is 1 KM.

    The question rather is: how can I build an audience for customers that move to a specific store (specific point on the map)? Therefore a radius of 0,05 KM or so would be necessary…

    Reply

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