Location-based targeting: myth versus reality
A view from Jide Sobo

Location-based targeting: myth versus reality

Not everything you've heard about location-based marketing is true, warns MEC UK's head of mobile.

The latest iPhone operating system, iOS 11, due out September, looks set to give users a better understanding of how apps are using their location data – and potentially make it harder for marketers to access the user’s location. 

This is because a prominent blue status bar will appear when an app is actively using location. What’s more, iOS 11 also introduces a new option of "while using the app" as well as "always' and "never" when it comes to sharing such information, giving people more control over how much they share their location.

That said, end users will almost certainly be willing to grant background location permissions if value is being provided, such as in social media, travel and weather apps.

Clearly, the potential of location data for audience building and campaign targeting remains enormous. Yet lack of transparency and maturity in the marketplace is hampering progress, in part due to inconsistencies between what is currently possible and what is being sold or claimed by the location market.

This has led to our recent analysis of the UK location data market, which we conducted in partnership with independent third party, Rippll, among five location data and mobile marketing companies.

This audit has helped to demystify location targeting, making it easier for us as an agency, to devise effective location-based ad campaigns that can exist within real world limitations and accelerate people around the purchase journey.

The fact is, the lack of understanding around the use of hyperlocal data for audience building, and campaign targeting, risks making a mockery of an industry with tremendous potential. Location data is hugely relevant, but not in the way that is often touted by suppliers in this area.

Here are the top five lessons we learned, which create a useful checklist that anybody looking to use location data would be wise to run past their potential partner:

  1. We hear of companies claiming that they can target down to two to three metres, but our recent audit with Rippll, which offers location data verification services for advertisers and agencies, revealed that some companies are less than 50% accurate at even 25 metres. This can be acceptable if you’re looking at an out-of-town superstore but obviously isn’t going to work on a high street. The likelihood is that you wouldn’t actually be able to tell that somebody was in Starbucks rather than the electronics shop next door. 
  2. Knowing the whereabouts of a handset is only part of the challenge, you also need to know what else is at that location for it to be useful. An important part of any location-based campaign is "Point of Information" data, but the ability to target the right ad, to the right person, at the right time, is hampered by reliability in this regard. In other words, you need to know that the electronics shop next door to Starbucks is still open and hasn’t been turned into a hairdresser’s.
  3. The five mobile marketing and data companies took part in our audit and well over 90% of the data points that we looked at didn’t provide any dwell time information. Most companies are only able to tell a user’s location at an instance in time, which means that they might have been sat on a bus travelling down the high street, rather than actually spending any time in either the Starbucks or that next door electronics shop. Without dwell time, footfall reports are virtually meaningless. Marketers don’t know if you visited a location or did anything in that store.
  4. It may sound obvious but location, by itself, is not sufficient to build an audience. It is only part of the context puzzle that can allow for personalised, relevant and timely communications. The addition of behavioural data from mobile sites and apps visited, or third party data from the likes of Experian or the DVLA, can help to improve the accuracy of audiences, as can leveraging historical geo-location data. Where you’ve been can say a lot about who you are and much of this contextual data lies untapped. You need so much more to accurately create a profile.
  5. Beacons are often heralded as the saviour of location marketing, but data from in-store beacons is likely to be limited to use by that store and not made generally available. So a beacon in a cinema, for instance, can help you target cinema-goers, but separating out those who may be in market for a new BMW is more tricky.

Location remains an important data set as we look to target people throughout the purchase journey. It is another signal to help build an effective picture of your audience, but whether they are mums, commuters, or gym goers, or all of the above, it’s important to leverage a number of data points to build the most accurate picture possible.

Understanding the finer points of what is, and isn’t possible, and asking the right questions of data suppliers, will help to unlock the true potential of location data for marketing.

Jide Sobo, is UK head of mobile at MEC