Location is going to be big in marketing; here’s why

Posted by Tina On December 30, 2013

There’s a dichotomy in the Australian marketing scene right now and around the globe. People use location-based services and they’re excited by them. Why, then do so few ad campaigns involve location and is there anything out there that suggests this will change?

Research from the TNS Mobile Life report tells us that 50% of Australians use location-based services. And IAB Australia research tells us that of all the potential of mobile, location is the most promising, according to the 150 industry people surveyed.

Yet very few campaigns include a location element.

The drawbacks around privacy have been covered well elsewhere so I want to concentrate on what might give this burgeoning area of digital advertising a lift.

Two big developments have happened recently that may well lead to a boom in location ads.

We all know how digital technology has shaped the customer journey.

People get inspiration online for their next purchase, they research through search, social and price comparison and also often buy online. (Google’s landmark ZMOT study gives us a lot of detail on this).

But when people enter stores they often put their mobile phone away, concentrate on what’s in front of them perhaps with advice from a friend, perhaps not.

These two developments could change that:

Apple + WiFiSLAM = in-store revolution

Apple’s recent purchase of WiFiSLAM for around AUS$22m tells us that the battle for control of the digital experience in-store is going to be big. A look at WiFiSLAM’s company description tells us so:

‘Allow your smartphone to pinpoint its location (and the location of your friends) in real-time to 2.5m accuracy using only ambient WiFi signals that are already present in buildings.We are building the next generation of location-based mobile apps that, for the first time, engage with users at the scale that personal interaction actually takes place. Applications range from step-by-step indoor navigation, to product-level retail customer engagement, to proximity-based social networking.’

‘Retail customer engagement’ is the key phrase here. If brands can offer a discount at the moment they know someone is looking at their products on a shelf, that’s a pretty compelling proposition. If they can send an immediately redeemable voucher, that’s when location becomes valuable.

Apple is not alone

Until now, in-store marketing has failed to undergo the change in technology that other stages of the customer journey have. Uninspiring cardboard cut-outs, end-of-aisle promotions, tasting stalls and paid-for window displays hardly smack of 21st century marketing.

Apple can change this. But it’s not alone in its intention.

At SXSW Interactive in Texas last year, Google revealed some of the developments that have emerged from Google X, its ‘moonshot’ big ideas department. These include driverless cars, voice recognition technology and the ability to make the blue dot on Google Maps a lot more accurate.

The blue dot development sounds completely underwhelming compared to the other game-changing technologies but, as an advertising company, Google knows the importance of accurate location data.

For Google, the inventor of intentional marketing, the goal of having people use their platform while in-store is potentially worth billions.

As with most technologies rolled out by Apple and Google and others, there is almost always someone doing it before them.

What to expect

For the customer, convenience is more in price discounts than not having to ask members of staff where to find the beansprouts. But there are multiple benefits for both retailer and customer.

Realistically, it will be a couple of years before stores offer this type of service. Before then we’ll see a landgrab from retailers desperate to have their own proprietary technology. Then there are the brands who will want to have as much control as possible in this crucial part of the customer journey.

The potential of this technology has been evident for a while. But with Apple and Google building the platforms to make it a reality, it will soon be down to brands and their agencies to build the comms on top.