Why Location Is Personalization’s Superpower for Merchants

In the current business landscape, consumers crave personalized experiences.

In an increasingly digital world, the importance of location intelligence in marketing cannot be overstated, particularly when it comes to areas like personalizing customer experiences, enhancing operational efficiencies and ensuring compliance across various industries.

“One of the trends we’re seeing is foreground location-based experiences,” Radar CEO and Co-founder Nick Patrick told PYMNTS.

Patrick explained that the stereotype of geofencing as a background activity — like triggering a push notification when a user is near a store — is becoming outdated in the face of modern applications that increasingly focus on engaging users through foreground experiences when they have an app open.

As businesses increasingly rely on data to inform their strategies, the ability to understand and leverage geographic information has emerged as a key differentiator. Location intelligence enables businesses to deliver highly personalized experiences to customers by integrating geographic data with other customer information. By understanding where customers are located and their movement patterns, companies can tailor their offerings, marketing campaigns and services to meet specific needs.

“A second trend we’re seeing is around indoor location, which we often call micro geofencing,” said Patrick.

Businesses are now looking to understand customer behavior at a granular level, he said, such as identifying which department of a store a customer is in or whether they are near a checkout area. The precise tracking enabled by micro geofencing allows for highly tailored customer interactions and a more personalized shopping experience.

Read more: Radar CEO Sees Geolocation Driving Future of Digital-Physical Commerce

Capturing the Emerging Trends in Location Intelligence

Location intelligence has evolved into a powerful tool, with solutions today that go beyond mapping and navigation. Instead, today’s location intelligence acts as a multifaceted force multiplier that offers businesses a competitive edge.

Patrick noted that a perhaps unexpected, but increasingly effective, new application of location intelligence is within fraud detection. Companies, particularly in eCommerce, logistics and gaming, are using geolocation to determine whether transactions are occurring from suspicious or unusual locations. This is crucial in preventing fraudulent activities and ensuring compliance with regional regulations.

One of the rapidly growing applications of Radar’s own technology is in the gaming industry, he added, noting that companies like DraftKings and FanDuel rely on geolocation to ensure compliance with state regulations, verifying that users are placing bets from legal jurisdictions.

Other sectors are beginning to recognize the importance of geolocation in ensuring regulatory compliance. Media and streaming companies, Patrick said, may need to restrict access to content based on geographic location, while payment services must ensure that transactions are conducted within permitted jurisdictions.

The principles of geolocation compliance also extend to other industries, such as logistics and eCommerce, where verifying the authenticity of a user’s location is crucial. For example, logistics companies can use geolocation to prevent workers from spoofing their location, while eCommerce businesses can detect fraudulent transactions based on suspicious location patterns.

The Future of Geolocation-Led Commerce

While the benefits of location intelligence are clear, integrating these technologies into a company’s marketing stack can be met with some key, but surmountable, challenges.

Two primary obstacles identified by Patrick are cost and privacy concerns.

In a time of heightened budget scrutiny, companies may view location intelligence as a “nice-to-have” rather than a “need-to-have” tool. Patrick said Radar addresses this challenge by offering cost-effective alternatives to existing map services, such as Google Maps. By saving on these essential but expensive services, businesses can reallocate funds to more innovative geolocation use cases that drive customer engagement and revenue.

At the same time, privacy concerns and the challenges of obtaining user consent for location tracking remain hurdles to adoption. Many users are hesitant to share their location data, which limits the effectiveness of background geolocation services. Radar is tackling this issue, Patrick said, by focusing on foreground, in-app experiences that engage a broader user base while respecting privacy preferences.

But by understanding the tangible benefits — such as increased in-store engagement, higher conversion rates and reduced fraud — businesses can make informed decisions about how to leverage location intelligence.