Growth of Geofencing
Introduction:
We called it GeoTargeting; GeoFencing was a great term when we started this. GeoFencing is a fantastic method of market segmentation. Take a look at this compiled article and see how it may help you and your marketing efforts.
Geofencing
[1]Overview
Geofencing Market is forecast to reach $2.3 billion by 2025, growing at a CAGR of 22.4% from 2020-2025. The rising growth of spatial data requirements and solutions to expand spatial data applications have led to increased demand for geofencing in recent years. In addition, growing public interest in media and marketing programs utilizing geofencing solutions and products will further enhance the overall market demand for geofencing during the forecast period. These programs will use virtual perimeter solutions to implement geofencing location-aware solutions. These location-based services will be used mainly for promotional programs and other applications. This will drive the positive Geofencing industry outlook during the forecast period.
Key Takeaways
- North America dominates the geofencing market due to increasing demand from S.M.E.s and significant companies’ significant growth in digitalization adoption.
- The growing popularity of new-age spatial data solutions, such as location analytics and geofencing, will aid in the market growth of geofencing solutions.
- Increasing adoption of location-based services, implementation of stringent government regulations related to fleet and freight management will increase the market demand for geofencing shortly, especially for the Transportation sector.
- Increasing concerns regarding location data tracking, particularly in the U.S.and European countries, will create hurdles for the geofencing market.
By Application- Segment Analysis
The Asset Management segment held the largest share in the Geofencing market in 2019. Rising usage of geofencing for tracking employees, particularly regarding entry to particular zones, will drive the adoption of geofencing for asset management solutions. The significant adoption of Real-Time Location System (R.T.L.S.) solutions based on RFID for employee tracking, particularly in healthcare in the U.S.U.S. and Europe, is anticipated to be the primary market driver. In addition, there is also a rising demand for spatial data-based APIs and tools access management geofence services for device data communication and interaction and security services. This is a major driving factor for the rising adoption of geofencing. However, increasing concerns of employees and customers regarding location data tracking will limit the market growth in the U.S.U.S. and Europe for Customer Tracking in Retail and Asset Management in healthcare sectors.
End-Use Industry – Segment Analysis
The transportation and logistics sector has been the primary market for geofencing for many years. Due to the increase in the Logistics tracking requirements over the past couple of decades in the U.S.U.S. and European markets, the usage of geofencing has always been considerably high in transportation and logistics applications compared to other applications. In addition, growing R&D investments in new geofencing solutions and technologies using these solutions, including driver monitoring and other A.D.A.S. systems, will boost the market for geofencing in transportation applications in the coming years.
Japan is A.P.A.C.’s largest adopter of Geofencing solutions and the world’s fourth-largest consumer after the U.S.U.S. U.K.U.K. and Germany. Japan has significant adoption in the transportation sector, but a substantial share of the growth has been from media and entertainment in recent years. In addition, the success of applications such as Pokemon has raised awareness of Geofencing usage in Retail and Media applications which has led to significant growth in recent years. Using this information, digital marketers have far more targeting capabilities, especially when geofencing is used in correlation with Demand Side Platforms (D.S.P.s). As a result, digital advertisers have started utilizing these geofencing solutions for targeted ads.
Geography – Segment Analysis
North America dominated the geofencing market by more than 30%, North America and Europe. The economy of A.P.A.C. is mainly influenced by the economic dynamics of countries such as China and India. Still, with growing foreign direct investment for the economic development of South East Asia, the current scenario is changing. Countries in South East Asia are witnessing high growth in the aviation and automotive industries. According to O.I.C.A., A.P.A.C. automotive sales saw an increase of over 6.52% during 2012-2018, with South East Asian countries having huge potential to grow.
Drivers – Geofencing Market
Rise of Proximity Marketing
Today’s consumers increasingly leverage mobile phones as a de facto portal to the world in many cases, making purchasing decisions based on mobile marketing. Marketing strategies that acknowledge and capitalize on this phenomenon will almost certainly outperform marketing strategies that don’t. For example, proximity marketing, where users are detected near a location (location-based services/location-aware services) and coupons for items or product sales etc., are beamed to the user’s device. This detection through the usage of RFID and G.P.S. solutions will be driven by improving detection technology and increased customer understanding. With increased marketing and knowledge of customer interests based on historical information, this proximity marketing can be used as an effective tool for improving customer reception. Retailers have even started displaying proximity marketing in digital signage to be actively targeted instead of generic advertisements. Adding interactivity to digital signage and implementing proximity marketing will increase customer reception. Thus, proximity marketing is witnessing significant adoption, especially in the retail sector.
Implementation of Virtual Perimeter Fencing in Transportation and Logistics Using Geofencing
Transportation and fleet companies globally are focusing on improving the management of logistical vehicles and have started using virtual perimeter fencing solutions as an additional security and management measure. In this way, it is possible to react immediately if, for example, the vehicle is moved across a national border without authorization. Fines for driving through areas closed to trucks can also be avoided. Fleet managers can use geofencing to track the exact route and ensure it does not deviate from the predefined path for valuable or time-critical freight. The virtual border is continuously monitored. If the driver differs, the fleet manager can contact him immediately and instruct the appropriate measures. This control level appeals to logistics companies to ensure proper procedure is followed and prevent fines and extra fees. This will drive the geofencing market to become a more defined part of fleet management solutions.
Challenges – Geofencing Market
G.D.P.R. Implementation and Effect on Geofencing
With the implementation of G.D.P.R., location data collection and its usage are becoming increasingly discussed. This data is collected in several ways, typically via I.P.I.P. address or mobile device I.D.I.D. Through public Wi-Fi or willingly enter your or zip codes by the user. This historical location data is then used by websites and companies (retail, banking, etc.) to provide location-specific advertisements as well as location-based blocking of information. With location data being considered personal data by G.D.P.R. regulations, the large-scale collection and usage of location data has become significantly more complex and could have potential legal implications depending on usage. Thus many companies are switching to either using anonymous data or asking user permissions for collecting data. This has resulted in significant changes in the business models of players looking to operate in the European Union, with some players pulling out altogether. Thus the implementation of G.D.P.R. and the potential legal implications have led to challenging circumstances on data collection requiring significant changes in the collection process. This will negatively impact the E.U.E.U. Geofencing market.
Market Landscape
Solution launches, acquisitions, and partnerships are vital strategies players adopt in the geofencing market. In 2019, the geofencing market was broadly diversified, led by major players including Esri, Embitel, Bluedot Innovation, LocationSmart, Envisage, DreamOrbit, Apple and Factual, among others.
[2]Key Market Trends
Retail Segment to Witness Significant Growth
- Retails are eagerly adopting digitalization to gain a more loyal customer base as digitalization allows them to engage their customers more efficiently and remotely. Retailers observe customers’ footfall as soon as they enter the geofenced area and push them with promotional notifications with this active geofencing solution to extract them.
- Automotive retailers use geofencing to keep watch on the customers taking test drives, and if the customers try to exit the specified area for an immediate alert can be achieved so that a quick response can be taken to avoid asset losses.
- The rise in smartphone usage globally is encouraging retails to adopt active geofencing technology to track even more footfalls in their geofenced region. It is observed that developing countries have better penetration of smartphones with 82% against 80% in developed countries. Also, smartphone shipments are expected to reach 2.2 billion units globally in 2019. Hence, the active geofencing market has growth opportunities in developing countries.
- Retailers deploy unconventional methods like unmanned aerial drones to deliver products to their customers. For instance, Walmart has planned to provide products in a safebox using drones rather than a doorstep. The application includes geofencing and blockchain technology for package tracking and identification.
[3]The research report segments the market into the following submarkets:
Geofencing Market By Component:
- Solution
- Services
Geofencing Market By Service:
- Deployment and integration services
- Support and maintenance services
- Consulting and advisory services
- API management and testing services
Geofencing Market By Geofencing Type:
- Fixed geofencing
- Mobile geofencing
Geofencing Market By Organization Size:
- Small and Medium-sized Enterprises (S.M.E.s)
- Large enterprises
Geofencing Market By Vertical:
- Transportation and logistics
- Retail
- Healthcare and life sciences
- Industrial manufacturing
- Media and entertainment
- Government and defence
- Banking, Financial Services, and Insurance (B.F.S.I.)
- Others (agriculture, education, construction and engineering, and energy and utilities)
Geofencing Market By Region:
- North America
- Europe
- APAC
- MENU
- Latin America
Available Customizations
With the given market data, MarketsandMarkets offers customizations as per the company’s specific needs. The following customization options are available for the report:
Geographic Analysis
- Further breakdown of the North American market into the U.S.U.S. and Canada
- Further breakdown of the European market into the UK, Germany, and France
Company Information
- Detailed analysis and profiling of additional market players
MarketsandMarkets forecasts the global geofencing market size to grow from USD 542.7 Million in 2017 to USD 1,825.3 Million by 2022, at a Compound Annual Growth Rate (CAGR) of 27.5%.
The geofencing market is segmented based on components (solution and services), geofencing type, organization size, verticals, and regions. In addition, geofencing services are further segmented into deployment and integration, support and maintenance, consulting and advisory, and API management and testing services.
The API management and testing services segment is expected to grow at the highest CAGR during the forecast period. The segment offers application access management, device data communication and interaction, and security services. API management services also carry out application operation, production support, release and change support, and middleware product support. Application testing service providers offer automated and manual mobile application testing to commercial customers for testing both native and hybrid mobile applications. In addition, the service providers deliver mobile application testing services for core functionality testing; user interface testing; mobile applications testing in wireless disconnectivity, low connectivity, Wi-Fi, and 2G and 3G networks; memory and battery leakage testing; and mobile application backward compatibility testing.
Based on organization size, the geofencing market is segmented into Small and Medium-sized Enterprises (S.M.E.s) and large enterprises. In addition, the market, based on verticals, is segmented into transportation and logistics; retail; healthcare and life sciences; industrial manufacturing; media and entertainment; government and defence; Banking, Financial Services, and Insurance (B.F.S.I.); and others (agriculture, education, construction and engineering, and energy and utilities).
The transportation and logistics vertical are expected to have the largest market share during the forecast period. Therefore, transport and logistics are some of the most dominating verticals concerning the deployment of geofencing market solutions. Industry applications of geofencing solutions in the transportation and logistics vertical include asset monitoring, speed limiting, fleet and freight management, and commercial transportation management.
The major factors driving the growth of the geofencing market are the penetration of new technologies, the rise in the use of spatial data and analytical tools, higher adoption of location-based applications among consumers, and the growth of competitive intelligence. Furthermore, the increase in Business Intelligence (B.I.B.I.) and the need to track the competitors’ marketing activities are other factors supporting the market’s overall growth.
Conclusion:
That was a lot to take in at once. So come back and reread it and look at the reference links below for an even more detailed look into GeoFencing.
Article compiled by hughesagency.ca
Article reference links:
