As more and more ad dollars shift to mobile and more and more advertisers, including struggling retailers, seek to drive foot traffic to their brick-and-mortar locations, is the time right for a cost-per-visit ad model?

Location-based adtech firm xAd thinks so. xAd, which uses a proprietary platform to "[automate] geo-boundaries around key places and points of interest" and says it delivers ads to 500m users each month, recently announced a new pay-per-visit ad offering in the US that will allow advertisers to pay for ads only when they drive consumers through the doors of their stores.

According to the company, "This new model represents a major shift in accountability from the buyer to partner solution, bringing improved transparency and accountability to the advertising industry.

"With the advent of fake news and some of the industry's most plaguing questions surrounding 'the quality and efficacy of served impressions,' xAd's move toward a more advanced performance-based model takes the complexity out of having to navigate industry pitfalls like viewability and ad fraud."

The pay-per-visit offering features third-party verification of visits through Placed, a location measurement firm, and xAd says that The Home Depot and Applebee's have signed on as launch partners. xAd isn't revealing how much advertisers will pay for each visit; its website states that pricing "varies by industry."

Is the location marketing era finally upon us?

Some, like UM Worldwide's US digital head Joshua Lowcock, thinks pay-per-visit could be as important a development as pay per click was. "The difference is, there are no accidental clicks when it comes to foot traffic. If a brand's focus is to drive store visits, you should be able to pay for those visits. Now you can align strategy directly to investment, creating an efficient, powerful buying model, one I believe can really cement location as a strategic must for marketers," he said.

Indeed, location looks like it will soon be a strategic must for marketers as more and more companies decide to offer up the location technologies they've developed to marketers.

For example, Foursquare, which now describes itself as a "technology company that uses location intelligence to build meaningful consumer experiences and business solutions," just announced that it is opening up a software development kit that will allow developers to incorporate Pilgrim, its core technology platform behind its Places database, stop detection, and snap-to-place awareness, into their apps.

And it's launching Foursquare Analytics, a "dynamic foot traffic dashboard for brands" that is currently being used by brands including Taco Bell, TGI Fridays, H&M, Lowe's and Equinox.

The timing for a golden era of location marketing couldn't come soon enough for retailers with physical locations. Thanks in large part to changing consumer behavior driven by the Amazonification of commerce, a growing number of retailers are downsizing and fighting for survival.

While solutions like xAd Cost Per Visit and Foursquare Analytics alone won't save them, having better insights into consumer behavior, the ability to target consumers at the right place and time when they're on the go, and the option to pay for ads only when they drive visits to their stores could help give retailers that jump on the location marketing bandwagon quickly enough a fighting chance.

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Patricio Robles

Published 30 March, 2017 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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