The Increasing Importance of Location in a Post-COVID World

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The proliferation of location-driven apps, smartphones and IoT-enabled devices has resulted in a plethora of data in just a few short years. And the volume of location data is set for explosive growth. Just think of all the apps you use every day that require your location such as Seamless, Airbnb, Tinder, Uber, Waze, Snapchat, Instagram, Hotel Tonight, TaskRabbit and Amazon to name a few. Each of these apps pinpoint where consumers are at a specific time. Location-targeted ad spend is projected to reach $35.5 billion by 2021 and $38.7 billion by 2022, roughly 45% of total mobile ad spend.

Hyper personalization + targeting 

Location-based marketing allows for the creation of customized, relevant and impactful campaigns. By tracking location usage in real-time, advertisers can create hyper personalized ad experiences with the benefits of agility, speed and optimization. 

For instance, what if a retail company could tell if someone is active at the gym, and therefore more likely to buy athletic wear. Or if someone recently purchased a ticket to the Bahamas and needs clothes for vacation. This is particularly evident in the DOOH world, where companies programmatically change content on their screens in real-time based on weather, time of day or season.

Beyond mobile

Typically, people think of location as SMS alerts or digital coupons, but there are many other channels to reach consumers. Top channels for leveraging location data are mobile (81%), but marketers are increasingly using location data in emerging channels, including advanced TV (49%), digital out-of-home (47%), voice/connected speakers (45%) and automotive (28%).

Types of targeting

  1. Geofencing maps out a specific geographic area where you want digital ads to appear. The ads are triggered when a person is in the virtual fenced-in area. This is the most prevalent tactic accounting for nearly 50% of all location-based marketing.
  2. Geotargeting delivers ads to people who have recently visited a specific location, for example people who have recently been to upscale gyms like Equinox or local sports clubs.  
  3. Geoconquesting advertises to people at a competitor location and steals them away from that competitor. For example, Burger King serving ads to customers at a McDonalds, with a special deal on the Whopper.
  4. Indoor location uses attributes such as WIFI, magnetics, lighting, and beacons to serve ads via SMS, email or in-app once a consumer is in range. Much of indoor location is also used for understanding traffic flow patterns, dwell times and other non-active data analytics use cases.
  5. Local Search. This is a valuable area of location-based marketing including SEM and SEO. In fact, over 80% of consumers have done a “near me” search, with 88% of these searchers calling or visiting a location within 24 hours.

Opportunities: What does the future hold?

We are in a pivotal time of innovation in media and advertising. As media consumption in the world continues to shift with the COVID pandemic, more and more emphasis will be placed on location-based marketing.

The biggest shift for location-based marketing will be in audience targeting. According to Asif Khan, Founder and Chairman of The LBMA, “the use of location data is quietly shifting from individual targeting to wider anonymous audience groups that exhibit common interests and common location.”

Layering on 3rd party data in addition to individuals’ exact location creates a more holistic picture of consumers. By including their behavioral attributes, attitudes and purchasing history, the ad is more likely to resonate. For example, as the GPS software app Waze calculates your driving route, the app might serve an ULTA coupon for a nearby location (knowing your buying history) and suggest a re-route on the way to your destination.

Location tech and analytics will propel a post-COVID reopening

Location tools and analytics are crucial in a post-COVID environment to power a strategic reopening for local businesses.

  1. Capacity monitoring. The use of location to monitor store/business traffic. This will be key as restaurants and retail locations slowly reopen after COVID, so they can accurately adhere to government mandates of only 25% to 50% capacity restrictions.
  2. Contact tracing. Apps with contact tracing can help prevent the spread of COVID by tracking an infected person’s location and notifying people nearby, some even have the capability to warn people when an infected person is close.
  3. IP location to identify new customers nearby. If you’ve used a weather app before and entered your city/zip code, that information is linked to your IP address. Local businesses can tap into this data to serve consumers highly targeted ads and encourage them to visit local businesses.

Accelerating what is possible with location

Precise location data paired with rich behavioral data creates a more targeted ad experience to empower consumers with the information they want, when they want. Context matters. Advertisers will benefit by leveraging location and incorporating personalized messages to consumers. People’s purchasing decisions and actions might be less intuitive given the pandemic, so location is more important than ever for effective advertising and in re-opening local businesses. Some of these changes will shape the world and attitudes moving forward about how we travel, where we live (cities vs suburbs) and how media is consumed. Location-based marketing consistently outperforms industry averages with higher consumer engagement, click through rates and conversions.

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