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Mobile marketing location based services, how does that work?

Mobile marketing location based services, how does that work?

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There is general consensus among mobile advertising industry pundits that mobile marketing is still underrated and has a long way to go before it can truly achieve its vast potential. Despite the fact that consumers now spend more time on their mobile phones than on any other commonly-used advertising medium, the amount of money spent on mobile marketing does not reflect this trend and mobile marketing budget still lags behind other categories. Many companies are still reluctant to invest heavily in mobile marketing, and are probably doing themselves a great disservice in the process.2013 is being touted as the year that will see a significant turnaround in mobile marketing fortunes and companies will now be in a position to realize tangible gains made through mobile advertising. One of the current hottest trends in this field is what industry experts refer to as “location-based mobile marketing.”

Location-Based Advertising is Effective

Location- based mobile marketing is the marketing practice whereby brand advertisers focus their advertising efforts, usually by using GPS technology, on people within certain preferences and locations. Location-based advertising has got several significant advantages as a targeted-advertising tool. Mobile location data as well as the behavioral insights that come with it can be harnessed and used by a company to deliver actual shoppers by using both historical data and real-time data. For instance, such data can be used to reveal where a certain mobile user frequently eats or shops. This easily translates to real and useful customer results. Companies can use this data to directly target customers with ads that are highly relevant to them. A good case in point is the Sense Networks program. Many leading retailers, quick-serve restaurants and leading brands use Sense Networks’ highly effective location-based advertising program as a means to reach highly relevant audiences through their mobile phones. Quiznos is one of the companies that use Sense Network’s program. Quiznos realized a significant increase in the number of mobile-based coupon redemptions as a result of using Sense Networks. The Sense Network program targeted local mobile consumers whose behavior aligned with Quiznos’ customers.

Geoware and Geofencing Highly Successful

A report released by New Research in 2012 revealed that about 36% of mobile marketing campaigns undertaken by companies last year used “geoware” or “geofencing” targeting. Geoware advertising uses real-time data from consumers based on their closeness to certain retail locations. Geofencing advertising uses ads on consumers based on specific distances from places they frequently visit.

Verve Mobile did a study involving 2,500 mobile campaigns in 2012 to study the benefits of using geoware and geofencing as targeted advertising tools. The report revealed that these two modes of location-based advertising are more effective than other forms. The study found that these two recorded higher click-through rates compared to other methods.

How Can a Business get started on Location-Based Advertising?

Verve Mobile revealed that only 9% of businesses are currently using some form of location-based mobile advertising. A small company can get started by enrolling in location-based programs such as Foursquare, a popular service with about 30 million customers and 3 billion check-ins. These businesses can place their offers on Foursquare. Mobile users then check in and leave reviews as well as claim offers provided by companies on Foursquare. Businesses enrolled on the Foursquare program benefit by getting to learn more about their customers’ location as they walk-in to redeem offers by companies.

Listing information by businesses on Foursquare involves aspects such as description, phone numbers, hours of business, social media profile and website links. Once set up, businesses should update their profiles, advertise their events and offer specials in a bid to promote their businesses and entice customers. Foursquare offers free analytics for businesses to track their customers and see what they are sharing on social media.

Risks Associated with Location-Based Mobile Advertising

There is a risk element associated with location-based mobile marketing. The biggest concern for consumers is how well their privacy is guarded. Consumers want to have the reassurance that their privacy will not be intruded upon by companies that are eagerly combing the mobile and digital ecosystem in a bid to learn more about their preferences, likes and dislikes. Companies that subscribe to this particular form of mobile advertising need to mitigate against such risks not just because of the moral implications, but also because they themselves stand to lose if they fail to do this. Companies that fail to fully secure their customers’ private information risk a negative blowback from these customers which could damage their reputation. FCC (Federal Communications Commission) recently made the first moves to regulate this sensitive advertising field and avoid infringement of consumers’ privacy.

Time to Roll out a Location-Based Advertising Program

Location-based mobile marketing is set to grow in leaps and bounds as businesses search for new ways to get closer to potential customers. Although mobile advertising is still in its infancy stages compared to other media, it is nevertheless one of the most promising, especially given the ubiquity of the mobile phone. By using simple but effective services such as Foursquare, businesses can now learn more about their customers’ locations and use this information to send out targeted mobile ads. Such programs are easy to roll out but the potential benefits are enormous.





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