On the Fence about Geofencing? Learn the Basics FirstJuly 13, 2018
Technology is evolving and improving rapidly. In these changing times, retailers must adapt to, and embrace, new innovations to stay relevant. Geofencing is one method for retailers and landlords to learn about their customers, enhance the shopping experience, and collect feedback. To utilize geofencing, retailers and landlords first must understand how it works and its benefits.
Benefits for Retailers
Geofencing utilizes now-ubiquitous GPS technology to track an enabled device, whether it be a phone, a tablet, a watch or computer, and triggers a programed response when the device enters a particular location within a mapped area. One of the most common geofencing applications for retailers is targeted advertising. Once a prospective customer enters into a predetermined zone of the retailer’s choosing – for instance, within a two-mile radius of the retailer’s store location – the customer will begin to receive advertisements and promotions through social media applications. But geofencing can go even further. If, for example, a customer enables their device to permit such tracking through wireless internet or a downloaded application, a retail tenant can use geofencing technology to trace the customer’s path through the premises once the customer enters the store, identifying the items that the customer hovers around. By collecting and analyzing this data, retailers can tailor their store displays, advertisements, and targeted email communications, which could lead to increased store traffic or sales.
Benefits for Landlords
Since geofencing data can be beneficial to retailers, a landlord can make their property that much more attractive to potential tenants by offering these services as an added benefit to renting in that location. Additionally, landlords can benefit from collecting and utilizing this information to better understand the areas and amenities preferred by the consumers visiting their shopping center. In a competitive retail environment, landlords can differentiate their shopping center from others by equipping the premises with geotracking technology. Tenants are always looking to lease in locations that are updated and provide the latest technology, so the advantages to landlords and their tenants are too great to pass up.
Before utilizing geofencing technology, it is important to understand the legal implications of this resource. Consulting with an attorney who has experience implementing this type of system is essential to make sure that a landlord’s interests are protected. Multiple contracts, including the leases between tenants and the landlord, must be updated to provide for this new amenity.
Read more from our Real Estate newsletter on the latest technology trends, and our recent work: