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Doug Chisholm is the Managing Director of Rippll, a location-based marketing solutions company, which helps brands to target consumers through portable devices in order to increase brand engagement and response rates.

I caught up with him in an attempt to demystify some of the pressing issues surrounding the eruption of location-based mobile marketing...

Straight in with a big question... Can you explain location-based marketing and its increasing importance?

Location-based marketing means tailoring your marketing messages based on where consumers are geographically when they see them,  and what that particular location reveals about their habits, alongside their ease of access to your brand's products and services. 

The sharp increase in the number of GPS enabled smartphones and the rise in location based social apps, like Foursquare, Facebook Places and Twitter Location are rapidly making location-based marketing a very effective advertising solution for many different types of organisations. 

What are the different types of location-based mobile marketing?

The possibilities are seemingly endless! Returning to basic marketing principles, you need to consider the “Push” and “Pull” marketing strategies. In location-based mobile marketing, Push methods include things like bluetooth or SMS alerts when you are nearby to a store or venue, as you’re trying to reach individual consumers directly.

However, I believe the massive downside to this is that consumers usually feel that this is quite invasive and will view the any marketing messages negatively. 

Pull strategy will generally be received in a much more positive light and is definitely the approach we try and take for our campaigns. Pull methods for location mobile can include a wide range of techniques, from geographical-based banner ads in smartphone applications advising the user that they are close to a particular brand and allowing engagement via a map or m-voucher, through to loyalty solutions based on physical consumer involvement, such as the check-in feature of Foursquare. 

To what extent have you seen a demand for location-based services increase?

On the consumer side we’ve seen the demand for location-based social applications explode, especially in the past few years, following the release and development of the iPhone App Store. In line with this, we’re now beginning to see advertisers attempting to catch up to this and leverage it and consequently becoming smarter in the process, especially in the methods of display advertising inside apps. 

Great examples of larger organisations carrying out this kind of activity include Orange and PizzaExpress, who have both recently advertised location based two-for-one deals on applications and have seen great results. Having seen great results, we know that they’re seriously looking to allocate increased amounts of investment into more mobile-driven, location-based marketing in this way. 

What kind of sentiment do consumers have towards location-based services?

Sentiment seems to be extremely positive and relatively trusting. The IAB quotes statistics indicating that some 70% of users are happy to share their location directly with an application, provided that the content they will see is more targeted and therefore more relevant to where they are. 

User generated reviews of location based social apps show that consumers feel empowered and excited by the new location based technology and this is causing all content publishers to start thinking about including location based features.

Furthermore, the meteoric rise and development of social platforms, such as Foursquare and Facebook Places should give marketers a strong sense of confidence that consumers will be keeping location-based services among the forefront of mobile activity. 

Which services are most successful? Are there any particular sectors that benefit more from these kinds of marketing activities?

At the moment, we’re seeing social content, city-guides and offer-led content benefitting the most from location-based targeting. Consequently, many of the high street brands have been the first to benefit from location based advertising in the wider sense.

That said, I expect a shift to happen, especially as uptake branches out among an increasing number of varied companies and advertising agencies, and the potential possibilities of targeting consumers who are in a particular place or mindset continue to emerge.

Do you feel that there needs to be an emphasis upon mobile local search?

Perhaps, but we are really seeing more and more consumers start their mobile internet journey from an application, not a search engine. This is especially evidenced by the fact that it appears to be something Google realised a long time ago, hence their development of the Android application platform. 

In this sense, the “long tail” of the internet is getting even longer on mobile, with each individual, niche user experience or search having an equally individual, niche app to accompany or compliment it.

If I want a local bar in London, I will use LondonBars...  If I want to find a local restaurant, I will use UrbanSpoon... If I want to find a clothing boutique, I will use Shopaholic. Considering this, it raises the question as to whether or not the future of mobile local search will actually involve a search engine process at any point along the user journey.

What developments do you expect to see within the next year?

Developments will continue to occur at a somewhat alarming rate. I envisage that application-based loyalty cards will become a widespread alternative to paper-based ones, especially for convenience FMCG companies.

More mobile vouchers will be used by large high street chains and more consumers will definitely be sharing their locations with content owners and publishers. I also expect large high street chains to begin testing location-based mobile ads, accompanied with ad-spend being scaled up dramatically next year, as mobile internet begins to reach its tipping point.

And in the next three to five years?

Location-based mobile advertising will likely follow the pattern of established digital advertising, albeit at an increased rate of development.

For example, it’s likely that behavioural targeting will emerge and as a result, consumers will begin to see even more relevant ads based on their habits and routines. Consequently, we’ll also start to see greater transparency from advertisers and publishers around why consumers are seeing these ads, along with ways for them to directly give feedback about the ads they would rather see in the future.

What advice would you give to those considering starting a mobile-location campaign?

As with any marketing campaign, ensure you know exactly what return you’re wanting from your investment of resources. This doesn’t necessarily have to be financial, it could be greater footfall in a specific store, increased use of loyalty vouchers, branding, etc. 

You also need to think about what certain regions say about a consumer's mindset. For example, take leisure, business and retail environments into consideration, and allow your marketing messages to reflect this.

Don’t just focus directly on targeting everyone who happens to be within a certain radius your specified location. You also need to consider the impact of other factors, such as dayparting. Remember, the more attention you pay to getting the details in the strategy and planning right, the more likely you are to achieving your objectives. 

What kinds of costs and resources are definitely needed for this kind of marketing activity?

How long is a piece of string?! This depends on any number of factors; the length of time you want the campaign to run for, the areas you want to target, the location platform you want to use, the mobile channel you want to use, partnership agreements with third-parties... The list is potentially endless.

I’d strongly recommend making budgets and resources one of the very first considerations when creating a location -based mobile marketing strategy, as with any marketing plan, standard mobile or otherwise. 

Finally, have you any other thoughts or insight about this relatively new area of digital marketing? 

Yes. Privacy will grow ever-more important as location becomes increasingly prolific, especially as brands continue to engage larger amounts of consumers at deeper levels.

I also strongly believe that the location-based targeting of content and advertising is definitely the next generation of the internet and will continue to bring huge amounts of innovation and a new methods of interaction between the triangle of advertisers, brands and consumers – especially those on the move – in very near future.

Jake Hird

Published 22 September, 2010 by Jake Hird

Jake Hird is Econsultancy Australia's Director of Research and Education. Follow him on Twitter and Google+, connect with him on LinkedIn or see what he's keeping an eye on via diigo

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Comments (2)

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Eric Miltsch

Jake, Love this post - very nicely done.

I agree with all of your key elements, especially regarding LB activities providing consumers with valuable benefits in exchange for sharing their location, status, etc.

Early this year I noticed the trend pick up speed and saw opportunities as well. I'd love to hear your feedback on my new location based social automotive app that was just approved this week. http://budurl.com/carzar

Keep up the great work, look forward to reading more about your take on this segment.

almost 6 years ago

Rayyan Agha

Rayyan Agha, Founder at CloudGreen

I can see Big Brother smiling here. Obviously privacy is a very hot debate with LB activities and will only grow hotter if not ring-fenced appropriately. Although I see and use LB services such as 4 squares, I can also see their nuisances and bombardment methods and if not, down right turn-offs if not used appropriately within a framework. Who takes on this task? Is the ASA raising its hand here, especially after its extension of its digital remit on Sept 1st? As it should have enough time to sort this out for the remit comes into force on March 1st 2011. However, this still begs the question of how far and wide reaching is the ASA for other mature countries?? Developing countries?

almost 6 years ago

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