What is Proximity Marketing and How It Works

There has never been a better time to include location based marketing in your marketing campaigns than right now. According to Forbes, 57% of consumers are more likely to engage with location based advertising.

Whether you’re a small business owner looking to attract more customers or a marketing professional seeking to enhance your overall strategy, this guide will provide you with the knowledge and insights you need to take advantage of this powerful marketing tool. We’ll explore some real-life examples of successful strategies and address common questions about implementing a proximity marketing campaign.

Using location data to target customers

By leveraging technologies like Bluetooth Low Energy (BLE) beacons, WiFi and Geofencing, you can send targeted messages and offers directly to someone’s mobile device.

It’s popular among businesses of all sizes as a powerful tool for attracting and engaging customers, because it allows you to deliver personalised and timely messages to customers, based on their location and online behaviour, increasing the likelihood of conversions.

Using digital marketing platforms such as Facebook or the Fluid Ads platform, which include geotargeting capability as part of their targeting options, you can personalise your messaging in a unique way that will feel hyper-relevant to the person receiving the ad. You also get valuable insights into customer behaviour and preferences, allowing you to tailor your marketing content even further.

Here are some of the key benefits

Improved customer engagement

Deliver personalised and relevant messages to a customers’ mobile device based on their location and behaviour. This can increase customer engagement and create a more positive overall experience, leading to increased customer satisfaction and loyalty.

Increased foot traffic

By targeting customers who are in close proximity to your businesses location, you can help drive foot traffic and increase the number of visitors to your store or venue. This can be especially beneficial for businesses that rely on physical foot traffic to generate sales, such as retail stores or restaurants.

Higher conversion rates

Achieve higher conversion rates, as customers who receive targeted messages on their mobile devices are more likely to make a purchase. In fact, studies have shown that personalised messages can lead to a 4.5x increase in conversion rates.

Valuable insights

By analysing data such as customer location, frequency of visits, and purchase history, you can tailor your marketing strategies to better meet the needs and preferences of your customers.


Compared to traditional marketing methods such as print advertising or direct mail, targeted marketing is more efficient, by leveraging the power of mobile technology, you can create more personalised and effective marketing campaigns that resonate with your target audience.

Examples of companies using Proximity Marketing

Dunkin Donuts

One of the early adopters was Dunkin Donuts, in 2016, they used geofencing marketing to gain a competitive advantage by targeting customers who were near their competitors’ coffee shops. By setting up geofences around these locations, Dunkin’ Donuts was able to send targeted advertisements and coupons to potential customers.


Starbucks has been a leader in proximity marketing with their mobile app, which uses geolocation and push notifications to deliver personalised offers and rewards to customers when they are near a store. This has helped increase foot traffic and drive sales, with users of the app accounting for over 40% of Starbucks’ in-store transactions.


Sephora uses Bluetooth enabled beacons in their stores to send customers personalised messages and offers when they enter a specific section of the store or are close to a particular product display. This has led to increased customer engagement and higher conversion rates, with customers who receive personalised offers being 3 times more likely to make a purchase.


Marriott enhances the guest experience in their hotels with mobile phone enabled keyless entry and in-room personalisation. By using their mobile app, Bluetooth enabled beacons allow guests to access their rooms without a key and receive personalised offers and recommendations based on their location and preferences.


The annual music festival Coachella enhances the attendee experience with geofencing and push notifications providing real-time updates on artist schedules, food and beverage options, and exclusive offers. This has helped increase customer satisfaction and engagement, with attendees spending more time at the festival and making more purchases.


Macy’s uses beacon technology in their stores to send personalised messages and offers to customers when they are near a product display or promotion. This has led to increased foot traffic and higher conversion rates, with customers who receive a message or personalised offers being 20% more likely to make a purchase.

These examples demonstrate the power and versatility of mobile device technology and targeted messaging, to enhance customer experience, drive sales, and build stronger relationships with customers.

How to implement Proximity Marketing

Here are the key steps:

  1. Choose the right technology: This could include Bluetooth beacons, NFC, or Geofencing Ads. Consider your specific business goals, budget, and target audience when choosing the technology that will work best for you.
  2. Design effective campaigns: This includes developing personalised messages and offers that will resonate with your target audience. You should also consider the timing and frequency of your messages, as well as the visual design and tone of voice.
  3. Test and refine: Conduct A/B testing to compare different messages and offers, and collecting feedback from customers to refine your approach.
  4. Measure results: Track metrics such as foot traffic, conversion rates, and customer engagement. Use this data to refine your campaigns and optimise your approach over time.
  5. Continuously improve: Stay up-to-date with the latest technology and trends, as well as gathering feedback from customers to ensure your campaigns are meeting their needs and expectations.

Challenges and limitations

It is important to also consider the challenges and limitations of this technique:


One of the main challenges is privacy. Customers may feel uncomfortable with businesses collecting their location data, and there may be regulations in place that limit what data can be collected and how it can be used.

Accuracy of location-based data

Another challenge is the accuracy of location based data. While technologies such as Bluetooth beacons and geofencing can be highly effective, there may be inaccuracies in location data that can lead to ineffective campaigns.

Need for user consent

In many cases, businesses need to obtain user consent before collecting location data or sending push notifications. As a business, you need to convince consumers to opt-in to your campaigns.

Limited reach

You may need to supplement this strategy with other marketing techniques to reach a wider audience.

The future

Here are some insights into how we expect it to evolve in the coming years:

Integration with artificial intelligence

To create personalised, data-driven campaigns that are tailored to individual consumers.

Increased use of wearables

As the use of the phones and wearable technology continues to grow, campaigns are likely to become more targeted and precise, with messages and offers sent directly to a consumer’s smartwatch or other wearable device.

Augmented reality

The use of augmented reality in is expected to grow, with businesses using this technology to create immersive experiences on mobile devices that engage customers and encourage them to visit their physical stores.

More precise targeting

The accuracy of location based data is likely to continue to improve, allowing businesses to create more precise targeting strategies and send offers and messages to customers who are in near to their physical stores.

Integration with social media

Campaigns are expected to become more integrated with social media, with businesses using platforms such as Facebook and Instagram to send targeted offers and messages to customers who are nearby their stores.

If you would like to start using location based marketing as part of your marketing campaigns, create an account or book a demo to see the platform in action.

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