Like magpies, humans have it in their nature to be drawn to shiny things. And so we see the current obsession of our industry on the new platforms, tech stacks and proprietary algorithms that form the 'pipes' that service the digital advertising ecosystem. However, I would argue our attentions are misplaced. Whilst the pipes are admittedly exciting and game changing, we shouldn’t lose sight of the fact that there’s a person at the end of it all, a human being made of flesh and bone, who lives in the real world and has real-world behaviours.
The proliferation of mobile phones and the subsequent explosion of location data facilitate the first genuine opportunity to understand these real-world behaviours. It’s this confluence of digital and physical that will not only revolutionise audience insight but also measurement. Much has been said about the increasing irrelevancy of the click, which many believe has overstayed its welcome as a measurement metric. Verified and accurate location data at scale provides a fresh perspective. What brand would obsess about clicks when it could understand the profile of visitors to its stores and see how footfall increased and changed as a result of advertising?
Like most things in adtech, it pays to do some digging to get past the sales spin surrounding location marketing, of which there is plenty right now. It’s important to uncover the nuts and bolts reality of the data being used and the technology that is producing/processing it.
Here are three key considerations when looking to win in location marketing.
Not all location data is created equal
The vast majority of location data available in digital advertising exchanges has questionable accuracy. Due to the premium value placed on location inventory, publishers are motivated to ensure their ad impression includes location data.
However not all location data is created equally, so it is critical to know exactly what data is being used to define location. Much of the available location data on the market is ultimately a compromise between accuracy and scale. At one end of the spectrum there is IP data: huge scale, readily accessible through a multitude of avenues, but highly questionable in accuracy due to the ability to mask and change IP addresses very easily. Anyone who has used a VPN knows this only too well.
At the other end of the spectrum, beacon technology has pinpoint accuracy but has specific dependencies from users in order to activate it. GPS/Wi-Fi data also offers good accuracy but only if both are enabled on the device and the data is verified.
Exclusive access to operator data offers both pinpoint accuracy and scale. Cell-tower data provides a constant stream of anonymised and permission-based location events without reliance on device enablement or verification. Operator data (which includes location and web/call usage) is deterministic—it requires no probabilistic modelling. It therefore provides the truest understanding of consumers and their real-world behaviours. Utilisation of other data sources will mean a tradeoff in either accuracy or scale.
Don’t chase me, know me
The explosion of location data has thankfully swept away the antiquated methods of surveys and census data to give invaluable real-time insight into consumers' real-world actions. However, the key is to resist the temptation of jumping in head first, and instead take time to understand the implications of what the data is telling us before we act.
Consider a shopping mall that has to compete aggressively for share of mind and wallet. Rich location data (particularly operator-sourced) that informs targeted, location-based advertising can give this mall a real competitive edge. Visitor footfall analysis may reveal that times of peak visitation do not correlate with times of peak sales, and this could then inform better moments for experiential campaigns.
Socio-demographic profiling of visitors could identify that students, rather than those of working age, favour the mall during weekday evenings, allowing for tailored promotions to appeal to this audience. Home/work/hangout analysis of visitors could show people will travel no more than 5 km to the mall, but 8 km to restaurants/entertainment, helping the mall tailor its non-retail offerings and advertising creative.
Future of measurement
The opportunity for mobile phones and the data they create to fundamentally change advertising measurement should not be underestimated. No other device bridges the gap between the digital and physical worlds, considering the majority of sales still occur in bricks-and mortar stores, location data now allows brands to measure the impact of their advertising on in-store footfall. Taking that one step further, if connected to the brands sales/CRM systems, attribution to sales uplift becomes a reality and a very exciting prospect.
For example, in a recent campaign with a QSR advertiser in Singapore, we were able to prove that dynamic mobile ads (with store name and distance included) activated once a user entered a geofence delivered 123 percent more store visits versus a generic ad served without the geofence. For brands operating in a competitive and cost-controlled advertising climate, proving tangible ROI like in-store footfall is incredibly powerful and a huge validation for the medium.
The future is bright for location marketing, and the promise is real. Be certain to get under the skin of the data and technology that forms the ecosystem, but also really embrace the opportunity to understand your audience as real people. As the capabilities and technology continue to evolve, the right location data and advertising will increasingly deliver smarter campaigns and smarter measurement, the likes of which the industry has not seen before.
Carl Nawagamuwa is vice president for Southeast Asia at Amobee