The geomarketing market is expected to reach USD 18.21 billion by 2026 from the present estimate of USD 7.35 billion in 2020 at a CAGR of 16.32% during the forecast period. Increasing adoption of digital mapping by many businesses, technological advancement in location-based analytics, and increasing need to analyze the huge business data to draw spatial reference insights to supply the right product to the right consumer at the right time that can surge company's revenue are some of the primary factors boosting geomarketing market.
- Increasing establishments of multinational companies in different geographical locations with various cultural, demographic, food and linguistics preference, have forced companies to opt geomarketing software that will provide a series of data and information that can be employed to identify and convert potential customers to real customers through marketing strategy.
- Moreover, a growing fight for customers is driving the demand of location-based intelligence by the marketing department of retail businesses to build location-based promotional activities and sent them in multiple ways such as proximity messages to the mobile devices of potential customers who pass by the store. It also provides information about some section of goods which are not selling so that retailers can change their marketing strategy. Additionally, data on the ethnicity of people living in the catchment area also provides further valuable information for product planning and personnel management, which retailers are using to expand their customer base and strengthen their revenue streams.
- For instance, Danisches Bettenlager, Denmark-based home decor retailer, is currently utilizing the geomarketing solution of WIGeoGIS for planning and optimization of brochure advertising. It also aims in the reduction of daily traveling time of sales managers by means of a newa and optimized sales structure.
- Lack of uniform regulatory standards in many countries has raised the concerns associated with customers' data privacy. Further, security concerns as applications and networks are under persistent security threats such as malicious code and service denial can lead to data loss, and leakage which can hamper the growth of the market in the future.
Key Market Trends
Location Based Services is Expected to Witness Significant Growth and Drive the Market
- Technological advancement in smart devices (smartphones, smart wearables, laptops), wireless connectivity, Internet of Things, cloud computing, has successfully increased the traffic and has driven the demand for analytical services due to their ability to analyze and deliver real-time geo-data.
- Moreover, increasing brand dependence on location-based service providers to determine customers' requirements and to verify customers' needs and their offerings are on the same level in order to remain one step ahead of competitors has driven the growth of the market. Companies also utilize location-based technology, advanced analytics, and automation to highly personalized customer experience and build brand loyalty to reduce churn rate due to ongoing competition.
- According to the study, brand loyalty aid companies to achieve revenue gains of 5% to 10% and reduce its costs by 15% to 25% within two or three years as new customer acquisition costs five times as to retain the current old customer.
- Further, location-based services have gained significant attention across various industrial sectors such as government authorities, telecommunications, transportation, and retailers, and have empowered players to offer promotional services based on customer's lifestyle and proximity. For instance, Uber, an American ride-hailing company offering services, works on customer's and driver's location information through smartphones. Location features help the company to improve its services, including pickups, navigation, customer support and promotional servies. So, it is expected that many businesses will gain promising insights through location-based services and will drive the market in the future.
North America Will Experience Significant Growth and Drive the Market
- North America is expected to dominate the market studied over the forecast period, mainly due to the increasing IT spending, acceptance of innovative and advanced technologies, and the presence of a large number of significant market vendors in the region.
- According to the report, IT spending on products and services in North America is forecast to grow 3.7% in 2019, will exceed USD 1 trillion in 2020, and will account for 40% of all worldwide revenues over the period. Further, United States spending on software will grow at a healthy 7.9% CAGR over the forecast period, making it the largest category by 2020.
- Moreover, changing technology, regulations, and customer expectations are transforming financial services pushing financial institutions to be more agile and open while maintaining tight security and data privacy. Now nearly two out of every three Americans own a smartphone, so financial institutions have a vast array of opportunities to capitalize by delivering products and services tailored to customers based on location, which has led to the collaboration of many BFSI organizations with IT providers. For instance, in 2018, Mastercard collaborated with Carto, software company, to develop packaged mapping solution, Mastercard Retail Location Insights, that is a multi-sectoral and very flexible solution which allows the analysis of key variables for accurate decision making, related to the assessment of territories, properties and other aspects of geolocation, which are essential for business success.
- COVID-19 has accelerated the growth of IT services and hence fueled the demand for geomarketing market. As the countries are under lockdown and people are restricted from going shopping, movies, restaurants, etc. so most of the companies are utilizing geomarketing tools to deliver customer-based services and increase their revenue source.
The geomarketing market is concentrated and is dominated by a few major players like Microsoft Corporation, IBM Corporation, Oracle Corporation, Google LLC, and Cisco Systems, Inc. These major players, with a prominent share in the market, are focusing on expanding their customer base across foreign countries. These companies are leveraging strategic collaborative initiatives to increase their market share and increase their profitability. However, with technological advancements and product innovations, mid-size to smaller companies are increasing their market presence by securing new contracts and by tapping new markets.
- May 2020 - ESRI Business Information Solutions Inc has partnered with the Inter-American Development Bank (IDB) to provide free access to geospatial technology in response to the COVID-19 emergency in Latin America and the Caribbean (LAC). Governments of the region will be able to use a COVID-19 solution to track critical equipment and assets availability, manage supply chains, and maintain business continuity.
- March 2020 - Bluedot, a leading provider of first-person location data, has announced an integration with Oracle Responsys, a real-time, omnichannel orchestration platform within the Oracle Marketing Cloud, to harness the power of location. The integration will give Oracle Responsys clients access to real-world insights needed to create meaningful, timely campaigns with their end customers.
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