What Is Geolocation?

Have you ever entered a search on Google, looking for the best pizza in your area? You type in something like, “best pizza near me,” to have a list or map of local pizza restaurants returned. Well, this is geolocation in action.

Geolocation, as the word might suggest, is the act of locating the geographical position of a device (computer, mobile phone, etc.) that is connected to the internet. There are several different ways a business or website can geolocate a device. For some of these methods, the site seeking the information needs to ask for a user’s permission first, while for other methods, they do not.

How does geolocation work? And how accurate is geolocation?

Continue reading to find out the answers to these questions as well as the various reasons companies might want to know users’ geolocations. We will also breakdown the various methods used to obtain geolocations, the pros and cons of each, and how geolocations are used to create key insights for businesses and better user experiences for customers.

What are the Different Methods of Geolocation?

Discovering the geolocation of a device can be achieved in more than one way. The three primary methods of accessing the location of a device are device-based geolocation, IP-based geolocation, and a combination of the two. Each method has its pros and cons which we will delve into further.

What is Device-Based Geolocation?

Device-based geolocation discovers the geographic location of devices such as laptops, mobile phones, and smart watches based on GPS and cellular networks. It works through triangulation, more specifically GPS-tower-device triangulation. For this reason, device-based geolocation is more accurate in densely populated areas such as cities, where there are more people using devices to assist with the triangulation. In rural areas, the accuracy of the geolocation can falter due to there being fewer users. However, if your device has a GPS chip and a network signal, geolocation services will be able to access its geolocation relatively accurately.

Because this method of geolocation relies on GPS chips inserted in devices, companies are not allowed to access it without the user’s permission. Websites and apps need to ask to access a user’s geolocation, and location services on the device must be turned on. For this reason, companies can utilize another form of geolocation that doesn’t require them to ask for a user’s permission first, which brings us to server-based geolocation.

What is IP-Based Geolocation?

IP-based geolocation, also known as IP address geolocation, is a method of geolocation based on the IP addresses of internet-connected devices. IP, or Internet Protocol, addresses are numerical codes assigned to every device that connects to the internet. IP addresses are typically assigned by internet service providers (ISPs). ISPs tend to use a range of IPs within certain geographical areas, which is how geolocation services are able to provide location data devices with IPs.

When an internet-connected device attempts to connect to a website, certain information is exchanged between the site and the device. One piece of information that the device shares with the site is its IP address. That IP address is then sent to an IP-to-location database where it is determined in which geographic area it is used by the ISP, thus revealing the approximate location of the device.

IP-to-location databases are operated and maintained by geolocation service providers. Each service has its own means of obtaining and sorting the data, some more accurate than others. As such, the accuracy of IP-based geolocation depends upon the ability of the geolocation provider processing it. Moreover, ISPs tend the shuffle IPs through various users within an area, adding another layer of complexity to the process.

While device-based geolocation works better in densely populated areas, IP-based geolocation typically works best for larger scale purposes. For example, if a company wanted to geotarget an entire country, or users in a specific postcode, IP-based geolocation would be more suitable than device-based geolocation.

With that said, geolocation services are becoming more accurate every day. Digital Element’s NetAcuity offering, for example, can target an IP address within a ZIP+4 area. Furthermore, it is accurate at a rate of 99.99% at the country level, 98%+ at a regional level, and 97%+ at a city level—globally.

While accessing an IP address can provide certain information about a user, such as the connection type and approximate location, it doesn’t reveal any personal information. Therefore, companies do not need to receive permission from a user to geolocate their device through IP-based geolocation.

What is Combined Data Collection?

As both of the aforementioned methods have their pros and, more importantly, their cons, combined data collection utilizes the best of each in attempt to be as accurate as possible. If a company’s goal is to target ads within a state, server-based geolocation would be the best option. However, if the same company wanted to target potential customers within a specific brick-and-mortar location, they would be better off turning to device-based geolocation. Combined data collection allows one company to do both relatively well.

Furthermore, one might be preferable to the other based on what a user has or hasn’t allowed. For instance, if a user has not allowed a site or app to track its location through their device, then businesses have no other option than IP-based geolocation, but that doesn’t mean they want to forgo device-based geolocation altogether as other users may be fine with making their location available.

What are the Benefits of Geolocation?

Although it may seem that geolocation is more useful for some businesses than users, this can be misleading. There are many benefits that geolocation provides to users, including personalized ads and content, as well as fraud protection.

For example, if you most often use a banking app or e-retailer while in Phoenix, Arizona, said sites and applications will make note of this. Then, if someone attempts to order something to Columbia or make a large withdrawal in Mozambique, the respective businesses can flag the purchase or withdrawal as suspicious and prevent them from occurring.

For businesses, geolocation can help to target advertising, localize content, enhance analytics, manage digital rights, prevent online fraud, and target mobile users. This makes geolocation services useful for a range of industries and integral to businesses that wish to maintain an edge on the competition.