Geomarketing: a trend in business
The Geomarketing is the answer to questions like: Why in a certain area of a city the corporate Wal-Mart decides to put a supermarket Aurrera instead of a Sam’s Club? o Why do some Nike shoes that we buy in Mexico are made in Indonesia with materials from Honduras? Geomarketing is more than the result of globalization, it is rather a discipline that focuses on generating competitive strategies based on the characteristics of society and its relationship with the geography where it is located.
The Geomarketing has arisen thanks to understand that marketing and the economy in general can not be excluded from geography, some characteristics of consumer behavior are closely related to the place where they live, their climate, location and culture. Pierre George (1984) states that current characteristics in the processes of production, transformation, circulation and consumption of goods are the result of the combination of geographical conditions and the actions of society through history.
Although the research and study in the area of Geomarketing has been carried out mainly in the last 20 years, there are companies that have applied similar strategies well before this period, an example is the Swiss company Nestlé, which in the year 1920 had with production plants in Brazil, Australia, the United States and also exported to Hong Kong. Nestlé can now dominate markets based on basic strategies, including decentralizing and adapting to local tastes.
Geomarketing uses statistical and cartographic tools to better express the geographical and demographic characteristics of certain cities or areas, the main information we can obtain from these tools are: environment, socio-economic level, trade balance, energy consumption, telecommunications, languages, religions and transportation, just to mention a few. This type of information is often provided free of charge by governments and is collected with the help of population censuses, cutting-edge technology such as GPS and satellite images.
These types of tools in Geomarketing have recently been used in very important areas such as advertising and a clear example is the case of Google Earth, a business search engine and places of interest that allows travel around the world combining satellite photos, maps, images in 3D and a lot of information about each place.
Advertising needs Geomarketing to be effective, and not make mistakes that later regret, Cateora and Graham (2001) believe that different societies most likely seek the same values or benefits of the primary function of a particular article, but there are Other psychological characteristics of the product that can be very different. Levi’s took this advice and created ads appropriate to the cultural characteristics of the countries that represented the biggest challenge for the company, one of them was Brazil, which is influenced by European fashion and therefore included images of Paris, in the case From England it was emphasized that the brand is a legendary product in the United States and American celebrities were included.
Another example of the application in advertising is the rent of spaces in the spectacular, most of the companies with this service offer the client statistical, geographic and behavioral information about the areas where the spectacular ones are located.
Commercial distribution has been one of the bases for a local company to grow into a national company. The necessary investment in the supply chain and in the production system must be governed by continuous improvement and innovation, so that the expansion costs are not very high and the benefits are maintained in the long term.
In the 70’s the Coors brewery located in Denver, Colorado was faced with a problem of commercial distribution, in the United States it could not cover different states far from the center of the country because its unpasteurized beer decomposed quickly, this condition took them to Keep the beer in refrigeration throughout the journey to wholesalers. Coors was able to solve this problem thanks to the construction of a brewery and a packing plant in strategic states, in this way the beer lasted longer without spoiling and obtained a savings in the cost of shipping.
Distribution is a basic aspect that determines the future of a new company, Martin Lindstrom (2006) affirms that the placement of a product in areas of interest is crucial to be able to create a positive association between the brand and the place. Jones Soda Co. made a similar distribution strategy, which was to locate custom refrigerators in places frequented by young people such as tattoo parlors, skate shops, clothing stores and music stores, obtaining favorable results, later introduced sodas to the self-service centers, large chains of coffee shops and groceries.
In addition to the applications of Geomarketing already mentioned, it is also useful to study the competitive environment of a certain area, in which there is a large amount and saturation of similar companies that eventually end up eliminating each other. The study and use of Geomarketing as a discipline is very recent and little demanded, which represents an opportunity for companies to identify growth options where previously they did not see them with normal distribution strategies, they would also avoid errors that lead to losses of money and time.