Location marketing 2.0 must avoid mistakes of the past

Location-based marketing is in vogue again, thanks to wearable technology and beacons. But the tactics must change as well as the gadgets if geo-targeting is not to fall flat for a second time.

Michael Barnett

As Marketing Week reveals in its Data Strategy section this week, the new wave of innovations enabling consumers to be targeted with marketing in specific locations is starting to get brands excited. The growing trend for installing digital technology into everyday clothing and accessories suggests unending possibilities for marketing that consumers could genuinely want to interact with when out and about.

Bluetooth-based beacons, meanwhile, mean the position of a mobile phone can be pinpointed more accurately than via GPS, though only in close proximity to the sensor (up to about 20 metres).

But while there is obvious potential resulting from the new technical capabilities, brands need to be careful that location 2.0 doesn’t resort to what has held back location-based marketing in the past – simply hurling out poorly targeted vouchers and discounts.

Looking in the rear-view mirror, the roads are strewn with the corpses of ill-executed initiatives built on location-based deals. They were supposed to be the silver bullet for Groupon, back when it was the world’s fastest growing business ever, while Facebook’s ‘check-in deals’ also fell by the wayside – in the UK at least – within months of being launched.

As the contributors to our upcoming Data Strategy article make clear, the more finely honed location targeting that’s now possible can’t just be used for the purpose of trying to entice people in with lowered prices.

Instead, the data needs to be used to infer likely behaviour and purchase intent, and then responded to sensitively by brands. ‘Sensitively’ is the operative word here, because one brand could easily poison the well for every other, meaning consumers either withdraw their consent to receive marketing or switch off the technology on their mobile and wearable devices altogether.

This is crucial. Everything brands do in this area has to be based on firm foundations of informed consent. Most consumers have no idea what these new technologies are yet, and it’ll be easy to spin them with scare stories about how brands are watching our every move. Indeed, if the technology is used badly, the scare stories might even be right.

And unless the rewards and prompts that people get telling them to go to a particular place are well though out, well targeted and change often, the law of diminishing returns is bound to apply. Above all, consumers will want to feel that they’re being rewarded, not manipulated.

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