During the 2015 holiday shopping season, it’s estimated that beacons and other location-based marketing solutions will drive $7.5 billion in spending by Millennials in the US (as predicted by inMarket). For anyone needing a quick refresher course in how geolocation and mobile marketing work, here are two common methods:

1) The retailer uses a beacon, an indoor positioning system that uses Bluetooth Low Energy technology to sense and trigger messages to Bluetooth-enabled phones. In order for this to happen, the consumer's device must meet these three criteria:

• Bluetooth turned on

• The retailer's app installed

• Location permissions and push permissions turned on for that retail app

2) The retailer uses a geofence to trigger notifications to an app within a targeted geographic range. In order for this to work, the consumer's device must meet these criteria:

• The retail app installed

• Location permissions and push permissions turned on for that retail app

In both scenarios, the retailer would use a push messaging solution (like Marketing Cloud mobile marketing solutions) to actually create and send the notification to the consumer's device.

While the technology is expected to drive dollars with younger shoppers, how many retailers are actually using geolocation to target shoppers in this way? Some large retailers like Walmart and GameStop are using geofencing this season, but the majority haven’t begun to tap into these capabilities.

In the 2015 State of Marketing report published by Salesforce Research, only 18% of marketers report using location-based functionality in their marketing this year. Geolocation technology is still a relatively new tool in the marketer’s toolbox, but not one that should be overlooked — particularly because 75% of smartphone users agree that location sharing produces more meaningful content.

You can read more about how mobile marketing overall played a role in 2015 in the full 2015 State of Marketing report.