What is Geospatial Analysis?
Geospatial analysis is the study and interpretation of geographical data collected from GIS, GPS, IoT, geotagging, and satellite imagery. It uses location information that has datasets such as an address, city, or zip code.
Why is geospatial analysis necessary?
Geospatial analysis uses location-based data collected from various technologies and builds data visualizations, including maps, graphs, statistics, etc. Data visualizations are used to understand complex relationships between people and places to predict future trends. It represents historical changes and ongoing shifts that make the predictions more accurate.
Benefits of Geospatial analysis
1) Deeper insights
Visual maps make it easier to understand events and trends and help to take actions accordingly.
2) Informed decision making
Based on the changing spatial conditions, it can help organizations prepare for future actions.
3) Better targeted solutions
Location-based data analysis can help organizations to understand why some solutions work in particular places and fail in others. It can also help to understand geographical aspects that affect trends and may have future consequences.
Geospatial analysis use cases
1) Improve sales and marketing
Geospatial analytics can help increase sales by doing proximity marketing to acquire new customers and existing ones. Market segmentation can be done by using spatial analysis and thereby improving promotions and retention and adding new customers.
2) Asset management
It can help companies to manage their assets. Moreover, it can be instrumental in identifying where all the assets are and also track their performance. Besides helping in replacing older assets, spatial analysis is important to identify new locations to install them.
3) Risk analysis
It is used to get in-depth details of any events at specific geographical locations. Using this risk analysis, financial organizations can take certain decisions and make policies accordingly for customers.
4) Improve logistics planning
Route optimization based on shortest distance, time, weather conditions, and traffic status can be done using geospatial analysis. This will reduce fuel costs, reduce carbon footprint, improve efficiency, and save overhead costs.
5) Strategic location determination
Companies face numerous challenges while locating a new store, restaurant, or healthcare facility. It is easier to understand the target market, competitors in the area, and operational costs with spatial analytics. Moreover, you can even discover a new store location that could have a higher potential to flourish.
6) Improve fraud detection and prevention
Using historical data from spatial analysis, organizations can find out locations associated with the higher number of frauds. Therefore, one can predict future events and take specific measures for prevention.
Which industries use Geospatial analysis?
Geospatial analysis plays a critical role in identifying growth opportunities while opening new bank locations. It also helps to analyze and monitor the performance of various bank branches, which will help overcome any risks and losses. Banks can even make decisions related to closing branches that are not performing well.
They can even leverage geospatial analysis while positioning new ATMs as it is challenging to determine which locations will ensure maximum revenue based on the potential customer base.
Accurate predictions are crucial for determining risks. Insurance companies focus on risk levels while making any policy as it is based on the location component. Some regions are more prone to earthquakes, hurricanes, natural disasters, and it is vital to set coverage rates based on the risks involved for a particular location. Geospatial analysis can help in catastrophe modeling and minimize losses for insurers. Also, policy pricing should be accurate to reduce the level of claims insurers receive, which is done using spatial data analysis.
To reduce carbon footprint and save fuel consumption, route optimization using spatial analysis can prove beneficial for the logistics and supply chain industry. Fleet management done with spatial analysis helps to improve efficiency and reduce fuel consumption.
It can help to set up warehouses in nearby locations with higher demand for deliveries. This will be beneficial as it will reduce travel time, fuel cost and save other expenses.
Selecting the right site for setting up a physical store is a crucial activity determining the future sales performance for a particular location. Spatial analysis based on the demographics, target customers, existing customers, buying behavior, spending habits, and more can help choose the right store location for better profits.
Also, businesses can use a detailed performance report for existing stores to make comparisons as to which ones perform better and what steps to take for improving the ones that are not. They can even decide to close the poor-performing outlets by referring to the historical performance reports created using geospatial analysis.
5) Healthcare and Pharma
Spatial analysis helps identify location factors that are the root cause of particular health problems for a specific geographical area. Using this data, companies can take certain measures to improve outreach, services, and prevention in many cases.
In case of epidemics, pandemics, or other emergencies, the spatial data can help prepare modeling/visualizations for driving decisions regarding safety measures guidelines.
In the case of pharma companies, spatial analytics data can help in territory optimization to improve sales rep productivity and reduce field operational costs. Cost-efficient management of distribution centers and supply of pharmaceuticals is possible by using location data from spatial analysis.
Setting up new towers for various locations is the need of the emerging telecom technologies. Spatial analysis based on network connectivity, network issues, data speeds, and more can be used to find untapped locations to implement towers.
It also helps while setting up stores in new localities that will ensure a high success rate and enable the right investment decisions. Identify sites that are similar to higher performing locations in various territories.
Geomarketing and proximity marketing campaigns are utilized by many players in the food industry. Geospatial analysis can help program campaigns that will ensure a high success rate based on historical data, customer base, potential customers, demographic data, food preferences, etc. Loyalty programs and discounts can also be promoted using proximity marketing which will be easier with detailed spatial analysis. Restaurants can also identify potential locations for opening new stores that will ensure higher response and maximum footfalls by using geospatial analysis.
According to a recent report, the Geospatial Analytics Market Size is set to reach 158.84 Billion dollars by 2027. It is applicable to a wider range of industries and the practical use will expand for a broad number of applications with higher data accuracy and better precision.