How Location Analysis Helps Data-driven Marketers

SCORE, a small business mentoring organisation, found that 58% of consumers used voice search to find local business information in 2018. Have you wondered why marketers pay attention to positioning ads at specific places? Or how a supermarket is always located at an optimal location from your house? Like other business aspects, organisations take into […]


  • SCORE, a small business mentoring organisation, found that 58% of consumers used voice search to find local business information in 2018.

    Have you wondered why marketers pay attention to positioning ads at specific places? Or how a supermarket is always located at an optimal location from your house?

    Like other business aspects, organisations take into account location as well; be it be in terms of offline stores or online campaigns, marketers are using data-driven locational analysis to identify the perfect location for their business.

    An ideal “location” of a mobile ad campaign or an offline store can help companies boost their revenue: increase sales, traffic generation, reduce costs and many other benefits.

    In 2015, supermarket chain Whole Foods partnered with the location-based marketing firm Thinknear to place geofences around their store locations to improve post-click conversion rates for its mobile ads. They also used geofences near competitor’s stores to target ads at shoppers, incentivising them to travel to a Whole Foods store nearby in exchange for better deals. The campaign yielded Whole Foods a 4.69% post-click conversion rate – more than three times the US national average of 1.43%.

    Also Read: inMarket to Acquire Thinknear, Expand Location-Based Marketing Solutions

    What Does Location Analysis Mean?

    Location analysis is a decision-making procedure which is aimed at identifying the ideal or most suitable location within a specific set for a particular purpose. In other words, it is the study and development of techniques, tools and models that provide feasible and efficient solutions for realistic locational decision problems to decision-makers.

    Business Plan Location Analysis

    Location analysis is a key aspect which measures the success of an organisation, especially when it comes to starting a new business or opening a sister-chain of an organisation. It is extremely crucial to set up an office in a location that serves all the business needs – right from high-speed internet connectivity to the ideal set of resources needed to run the office.

    Location analysis not only proves to be an important factor for businesses that provide offline services but for online businesses as well. But in a different way. The online location of a company is akin to having the right online advertising platform, domain name, search engine optimisation, and marketing campaigns that helps in lead generation and branding of business.

    While performing a location analysis for business, whether offline or online, you should essentially ask yourself two questions:

    1. Why here?
    2. How can I succeed here?

    Site Selection

    Answering the “why here” for a brick and mortar location, will address the physical location or address where your organisation will be located. However, for an online business, the “why here” will address your web hosting service, website domain, ad campaigns and online presence in terms of search results and social media platforms.

    Numerous factors need to be considered while choosing a site for your business. Some of the fundamental pointers to mind while performing a location analysis are:

    • Elements that attracted you to this location.
    • The process that you followed to identify this location, or simply put, how did you narrow down from a gamut of choices to this specific location, or from the wide range of URLs to this specific URL you are considering.
    • A proper demographic analysis of the people in that area. Make sure that you identify your target customers and segregate them in different groups, based on their needs, previous data history, and behavioural insights etc. Supposedly, your target customers are women, analyse the number of women in the specific area you will be targeting.
    • Traffic hours indicate the peak hours for online (or offline) traffic that can be incorporated in marketing strategies to target customers or used for deciding the optimal timeline for working hours (offline and online campaigns as well).
    • Understand which demographic location will help you achieve the best output at a given time, and invest accordingly. There might be certain times where online campaigns might receive greater exposure, and by working on them, you can increase your visibility, convert more sales numbers, and generate higher revenue.
    • Competition in the industry at a specific location. For example, identify if people residing at Location X prefer an already established aka prominent brand or have random, multiple choices.

    Also Read: Millennials Are Using Voice Search to Find Local Small Businesses, Mostly Restaurants

    Top 3 Brands Using Location Analysis

    Costco considers population trends as a major factor to ensure that the neighbourhood in which they locate their stores can sustain sales of their bulk-packaged orders.

    Whole Foods selects their locations based on multiple factors. The company analysed that one of the key aspects which determines if customers will shop from their grocery stores is their level of education. As a result, the company’s site selection process entails locations that have a higher per-capita level of college degrees.

    Walmart uses advertisements to evaluate how far people will go to purchase products at their stores. They analyse insights collected via tracking mobile ads and create a geofence boundary to determine which customer goes where to buy what. This helps them locate their new stores at optimal positions with increased chances of sales.

    Business Location Analysis

    Once you have collected all the data e, you can perform business location analysis. It is an important step as it shows the foundational ideas and considerations you must take into account while choosing a location for your business activities, be it be offline or online.

    Here are some basic elements that will help you structure your business plan and put perspective on your reasoning:

    • Analyse the challenges you will overcome. For example, do you feel targeting a specific audience aged 40-60 will be difficult than targeting an audience aged 18-30? Are the costs of running a Facebook ad campaign in a particular region too high for your budget?
    • Who are your competitors based on the locational analysis? What is your USP, compared to your competitors?
    • Outline some of the best and worst-case scenarios for your marketing tactics. Create some contingency plans by referring to the data collected via locational analysis.
    • Highlight the strategies that could work for your business.

    Do the research and think through your data’s consequences to enhance your chances of success with your marketing strategies or business plans.

    Solutions like CARTO empowers everyone, from business analysts to data scientists, to turn location data into business outcomes. Their open, cloud software offers visual insights on where things happen, why they happen and predict what will happen in the future.

    Also Read: Native Advertising is Ushering Better Engagement and Sales

    Impact of Location Analysis in Data-Driven Marketing

    Increasing Sales

    Businesses all around the world utilise location analysis to increase sales with targeted marketing. Location analysis helps in fine-tuning the intricacy of large amounts of data by combing through psycho-demographics, sentiment analysis, and buying patterns of consumers that are linked together by longitude and latitude. By analysing data based on locational information and combining it with marketing tactics, businesses can generate higher revenues by targeting a specific range of customers or groups at a particular location.

    Controlling Costs

    Location analysis assists professionals in visualising their business performance, including costs and revenues. It can help in gathering information about regular expenses like internet charges, ad campaigns costs, marketing tools, models and equipment.

    Additionally, the locational analysis also aids in outlining the costing chart for inefficient tools that could be incurring extra charges with irrelevant results. Data-driven marketers can create maps based on these analysis to quickly identify patterns and correlations between the data collected locally, regionally, nationally and globally, to evaluate the effectiveness of their strategies.

    Location analysis has also proved to be a significant part of mitigating risks and lowering costs in supply chain management. The most well-known applications are more often than not nestled around optimum siting of assets and facilities. Location analysis also helps in routing or rerouting in real-time in response to traffic patterns.

    Also Read: Millennials and Gen Z Want Experiences Across Channels: CMO Council Study

    Boosting Customer Satisfaction

    Organisations understand the power of customer satisfaction and have become highly flexible in terms of their business plans, including marketing models, product charges, and service features. Companies like Netflix, Amazon, Uber, and IBM play big in the industry by ensuring a higher rate of customer satisfaction.

    They harness the power of locational analysis to serve their customers with much precise and value-based products, to meet their expectations and fulfil their needs. Companies even modify their pricing plans for the same product, based on locational data.

    By using location-based data, companies can quickly identify and eliminate the root cause of customer service issues. They can also determine whether or not their patterns are consistent throughout a specific region or if their marketing models or products are performing as planned.


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