Worth a read

Location Based Marketing. Has it a place in your mix?

Successful marketing relies on targeting the right person, with the right message, at the right time. Right?

Right. Of course marketers need to know who their customers are, how best to influence them and when to reach them, but the proliferation of location-based social media networks with their trendy apps, and the accelerating development of smartphone geolocation technology allows them to now know exactly WHERE their customers are at time of contact, presenting an exciting marketing opportunity for brand owners and particularly for bricks-and-mortar retailers.

The opportunity originates from ‘lo-so’ networks, as they are called – location-based social media networks which consumers use to ‘check-in’ by smartphone, mobile email or text with their friends and family, Facebook and Twitter followers when they are out and about. By ‘checking-in’ from the real world to the virtual world they reveal their specific location to the lo-so network via GPS. LBM has taken off big in recent years with major lo-so network players being Foursquare, Facebook Places, and Twitter among others.

By ‘checking-in’ to the virtual world consumers reveal their whereabouts

Subscribers are encouraged to check-in to send text messages, geotagged photos or videos and leave location-based recommendations, known as ‘tips’, for their friends to discover when they visit the same location. They participate in real-time social gaming and online competitions, awarding each other virtual prizes by unlocking digital stickers and badges. And the more often subscribers check-in the more the network rewards them, one way or another. Foursquare, one of the biggest networks with over 55 million users and 1.9 million participating businesses, bestows the honorary title of Mayor to the person checking-in most often at a particular venue, and the Mayor receives special rewards. Its recently-launched Swarm app makes checking-in even easier.

Savvy marketers soon spotted the opportunity of exploiting these lo-so check-ins to reach potential customers when they know they are in the vicinity of their retail store, or a store which stocks their brand, and so passive location-based marketing was born. Through the network, businesses offer the consumer real-time promotional offers, sales discounts, mobile coupons, prize draws, etc., stimulating impulse purchase when they check-in while in the immediate vicinity of their store. These offers have particular appeal to the consumer because of their immediacy and the instant gratification they deliver. And the value to the business goes well beyond a sale on the day – they encourage customers to check-in at their venue and pass on the promotional message to their family, friends, Facebook and Twitter followers, gaining advertising impressions at an exponential rate.

A more recent further development is the emergence of opt-in location-aware network services such as ShopAlerts, trialled by O2 in the UK initially with Starbucks, L’Oréal and M&S. The networks use geo-fencing technology around a retail location to automatically receive customer location status updates, actively tracking the subscriber’s location in real time and enabling participating businesses to engage with customers when they’re in the vicinity, with no need for them to have checked-in first. The promotional messages are layered in with useful information such as local weather and traffic reports, shopping mall details, and the like, and so customers are likely to be more receptive to them.

While it’s been around for a while, future growth of Location Based Marketing, and particularly the opt-in, active version of same, is predicted to continue to escalate, as it sees business making sound commercial use out of social networking.

ShopAlerts enabled by real-time customer location tracking

Utilised effectively as a real-time direct response tool, LBM can create immediate customer footfall and sales, and with only modest investment necessary, it can deliver increased ROI for bricks-and-mortar retailers. And because of LBM’s use of social networks it facilitates customer engagement on an intimate level, helping improve levels of customer aquisition and retension for brand owners as well as retailers.

Watch out for Location Based Marketing – ‘Coming Soon to a Venue Near You’

 

Andy Sellers is founder and Creative Director of S&® the brandvertising agency, and a ‘Seriously Creative’ Consultant.