What is Location based marketing?

Location-Based Marketing (LBM) is defined as the use of mobile marketing to target mobile users within a certain geographic area. The technique can be used by businesses that want to send mobile display (banner) ads, mobile paid search ads or other forms of mobile advertising to people who have been located using GPS or cell tower triangulation. Typically, location-based alerts are delivered to smartphones through SMS text messages or notifications by apps. An alert may include information about a local business’ deal of the day or include a purchasing incentive, such as a discount coupon code or a special offer.
Location-based marketing requires the end user to opt-in. The opt-in process usually takes place when the end user downloads a mobile app and responds “ok” to the app’s request to use the device’s current location. The technology behind LMS takes advantage of geofencing, a software feature that uses triggers to send alerts when a device crosses a pre-defined geographic boundary. The goal of LMS, as with any mobile marketing initiative, is to capture the end user’s attention and turn him into a customer.
Location-Based Marketing is perfect for you if you want to promote your product or service to people within a specific area. In other words, if you’re a restaurant owner and you want to send a mobile ad to people who are within a 5-kilometer radius of your location, then LBM is one of the tools you’d want to use.

What is Location based marketing?

Benefits of LBM?

Location based marketing helps a business grow in many ways. Let’s discuss some benefits of this way of marketing.

Attract more customers

Location based marketing enables you to reach the right people, at the right time, in the right place. Like real-time marketing, you can get in front of people at the time when they will need your product or service. Or, you can reach people at a time when they will be most receptive to other offers of your business and become a lead.

For example, Swiggy and Faasos always send push notifications during meal time, you may or may not be hungry at that time but they surely will have created a mark in your mind, that you can order food through them when you feel hungry.

Deepen your connection with your target audience

When targeting a people in a specific location, you can cater your content to characteristics people share in that area. Catered content resonates more with people and helps them to feel more connected to your business. In addition, content that is specific to their circumstances will show that you are knowledgeable of the people and their area, which can foster trust.

Example, Foursquare (Now Swarm), a app using which you can check in at places you’ve visited and when you check in at a restaurant or a store they might offer you a discount because you have checked in at their store.

Boost engagement and response rates

Another benefit of location based marketing is that it can boost engagement. Not only will people appreciate catered content, they are more likely to engage with it. Whether this means calling a number on a postcard, downloading a piece of content relevant to their area, or engaging with your social media posts, location based marketing can encourage more activity among your target audience. More engagement with your business can mean more sales, but can also mean greater online visibility and increased brand awareness.

Example, Little App is a hyperlocal deals discovery platform which connects customers and merchants across services like restaurants, spa, salons, activities etc. It helps customers discover fantastic offers at their favourite outlets and also become a sales channel for offline merchants.

Better return on investment

Sometimes, it’s not about doing more of a particular marketing activity, it’s about doing the same amount of that marketing activity but getting more out of it. Whether it’s more leads, engagement, customers, etc., location based marketing can maximize your marketing activities, yielding a better return on the investment of your time, effort, money, or other resources.

Let’s now have a look at two location based marketing campaigns which were highly successful and gained all the benefits listed above!

  • OLX used location based marketing to run a campaign which was very successful, they used hyper-location targeting to reach 2nd hand automobile & mobile markets using pin-codes. The users were targeted with personalized contextual overlay ads using network apps and mobile sites. The 6 weeks long campaign saw over 5, 00,000 unique users and cost per unique reach was 3 paise. The click to install app was 4 times more than other campaigns. 60% of the install resulted in transactions.
  • Bose wanted to reach a specific audience set to build awareness for its premium noise cancelling earphones in key cities. Bose used location-based advertising to reach out to audience present within a 500-meter radius of all airports in India, users who visited 5-star hotels in the vicinity of airports and who lived in the top 10 percentiles of residential areas. The users were shown dynamic banners and landing pages based on their location. The campaign delivered over 5,000 clicks every day for Bose during the campaign duration. Read the detailed case study on the campaign here.

Most commonly used tools for LBM

Future of LBM

Location-based advertising and marketing technology has seen tremendous growth and improvement in 2016. Thanks to innovations in location intelligence, marketers can now leverage real-time data to better target consumers based on where they go, effectively measure how digital ads drive foot traffic into stores, and even connect the consumer journey from ad exposure to store visit to purchase data.
Location intelligence is a massive industry. It allows consumer obsession with mobile devices to create significant amounts of data and insights that drive critical decision-making for a wide range of businesses.
But since the space is still nascent, marketers should expect evolution in the year ahead. Here are five predictions for location intelligence in 2017:

1.Location intelligence companies will consolidate

In the year ahead, we’ll see some location-based marketing companies team up while others drop off entirely. Ultimately, only a handful (likely just three) of the major players will endure. What will these survivors have in common? Unique assets, differentiated technology and transparent ways of doing business.

2. Clients will demand more transparency

In 2017, clients are going to demand more transparency from their location intelligence providers. They’ll want to understand how data is being collected, how it is being verified and what the consumer’s role is. Walled gardens will come under pressure to open up, and transparency will help marketers better gauge the accuracy and precision of the data they’re working with. Companies that haven’t moved on to programmatic ad buying will be called out.

3. Publishers will rely on real-world attribution to prove out their value

Over the past 20 years, analytics for digital ad measurement have focused on digital results (including web traffic, ecommerce conversion and data collection). But even though we live in an Amazon world, 92 percent of commerce still happens in physical brick-and-mortar locations, so measuring digital impact is nowhere near sufficient.

Newer attribution products allow publishers to prove their value offline by measuring how successful digital ads are at driving consumers into stores.

A flurry of publishers and platforms will scramble in 2017 to implement sharper real-world attribution tools to show advertising partners how digital ad inventory can drive foot traffic into brick-and-mortar stores. This will open up a new way for marketers to measure results and learn about where their consumers spend their time in the physical world.

4. Publishers will rely on real-world attribution to prove out their valuet

Sometimes, it’s not about doing more of a particular marketing activity, it’s about doing the same amount of that marketing activity but getting more out of it. Whether it’s more leads, engagement, customers, etc., location based marketing can maximize your marketing activities, yielding a better return on the investment of your time, effort, money, or other resources.

5. Everyone will shift more toward mobile (and more toward location)

The consumer shift to mobile is very real and something that marketers need to optimize around in order to increase sales in a competitive landscape. Yet many marketers still haven’t wrapped their minds around how rapid acceleration towards mobile impacts their business.
The key point that many miss: Thanks to mobile, advertisers can get a real understanding of consumers based on the places they visit in real time. Location is the cookie of the real world, and companies can use mobile-location data to target consumers and measure success, constantly refining and optimizing campaigns with daily data insights.
Companies can no longer afford to ignore the power of location data, and industries that are slow to adopt location intelligence will be trounced by their competitors.

Marketers enamoured with the idea of “the next big thing” oftentimes get so caught up trying to identify it that they accidentally overlook critical tools capable of changing their business.

Location intelligence is one such area. It’s available, it’s new, and it’s going to change how businesses grow.

In 2017, marketers will realize that it’s no longer sufficient to just “check the box.” The smartest brands and companies will turn good quality data into smart, actionable consumer insights and business strategies. These leading brands will want to have more ownership of and expertise in their own location data.

Proponents applaud location-based advertising as, a way to bridge the gap between online and physical customer experiences and promote impulse purchases. Sceptics question whether LBM will cause consumer burn-out and violate consumer privacy if the data that’s gathered through LBM is not used, shared, protected and stored properly. Companies engaging in LBM should take measures to ensure customer privacy through stringent opt-in policies and security safeguards.