Get Smart about Location Intelligence

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Where in the world is location intelligence these days? The field has ventured well past its original marketing use case of serving ads to users who happened to be near your store. Today, innovative marketers are using location data to improve marketing strategies, define new consumer segments, and improve customer service, among other use cases.

The use of location information for broader business intelligence purposes is likely to increase, claims a recent eMarketer report. Helped by artificial intelligence (AI) and other powerful data analysis tools, historic location data will help marketers identify patterns in movements and customer journeys to improve planning, attribution, and online-to-offline (O2O) metrics – a coveted capability for many advertisers using traditional media.

Several companies claim to do O2O measurement already; Foursquare and partner Inscape are the most recent addition to the group. Foursquare uses a deterministic measurement approach to help quantify the impact of TV. While it is not perfect, it ties an action to an ad view, which is a much needed data signal to layer on top of Nielsen ratings alone. And, as the technologies continue to improve, this type of location-based measurement capabilities are likely to transform the way advertisers plan and budget for TV and other traditional media.

Another hurdle that location intelligence seems to have overcome is consumer awareness and, to a lesser extent, consumer distrust. A recent survey finds that most people (83%) know that companies track their location data and 63% more people YoY are aware that their personal location data is used to market to them. Many are unfazed. Of those surveyed, 29% had location tracking permanently enabled, while another 38% opt-in to it, when prompted by apps. The remaining 33% have permanently disabled location tracking on their mobile devices. But more than half of them could be persuaded to opt-in under the right conditions, which centered on being able to choose how and with whom they share the data.

The question of trust doesn’t stop at the consumer level, however. Marketers have concerns about the quality and provenance of location data, too. To ensure they have full control of the opt-in process and privacy regulations compliance, many marketers rely on their own (first-party) data, according to eMarketer. But intra-company silos and other obstacles, such as skill gaps, often prevent marketers from being able to make proper use of it. Those who use third-party location data providers perceive data source transparency as a good indicator of the quality of the data.

Marketers are similarly split on the effectiveness of location-based ads to drive store visits. Slightly more than half of the respondents in a survey from data platform Factual report a lift in sales and higher conversion rates after using location data in targeted ads. Yet, only about a third of them agree that location-based ad personalization results in lift in store foot traffic. In comparison, 36% of mobile app users in another survey said they’ve made an in-store purchase after receiving a location-based push notification.

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