TThe advertising industry has been enthusiastic about the possibility of using mobile technology to better target messages using consumer location for about 20 years now. But the confluence of several emerging tools, such as iBeacons, in-store Wi-Fi, and the ability to message apps on mobile phones, has put hyper-local marketing back at the top of the hype cycle.
The premise of knowing a person’s location before you send them an advertisement is that the location is a good indicator of context. If a Topshop customer is near one of their stores, wouldn’t it be great to offer them an incentive to attract them? This obviously assumes that the consumer has previously identified himself as a customer and that he is happy to receive this type of message.
However, it is just not that simple in reality. Yes, someone might be near a store, but they might not be in a shopping frame of mind to respond positively. They may be working nearby, visiting a sick friend, or just not in the mood. The risk for the advertiser is that if they get the right message but at the wrong time, the consumer may refuse to engage in the future, losing them as a potential buyer forever.
So, using location to understand context is a much more subtle game than it might appear on first glance and advertisers should be careful in exploring.
Another problem is that most advertisers are always looking for high reach in their marketing efforts. However, if the filtering is applied around a store in one location at a specific time of day, the numbers engaged are often so small that they make no difference in the footfall resulting from the micro-campaign.
For example, Blis Media helped Spotify generate great results by running ads in airport cafes assuming consumers would be in the mood to buy last minute travel entertainment. Likewise, advertisements for the Mini Paceman and Countryman were aimed at higher income people by advertising when they were in 4/5 star hotels, airport lounges and Michelin starred restaurants.
Localization can be used even more precisely by advertisers investing in understanding the potential of new tools. Sky Sports is currently running a campaign aimed at people who have attended football matches at either Sunderland or Newcastle stadiums to promote an upcoming derby match broadcast between the two rival clubs. It’s easy to see this kind of thinking reoccurring on a large scale among Premier League fans.
The in-store opportunity
The other area of opportunity for hyper-local marketing is in-store and with 76% of purchasing decisions made there (POPAI), this could be a game-changer for marketing. While there is a lot of talk around iBeacons, there is a strong case for in-store Wi-Fi is where the smart money is going – after all, the Wi-Fi option doesn’t require the internet. installation and maintenance of additional equipment in store and yet undoubtedly achieves a better range, with the same precision.
According to WiForia, specialist in this field with dozens of trials planned in the coming months, while supermarkets will probably be the first to adopt the technology and the marketing channel, other verticals such as shopping malls, travel hubs like airports and train stations, and even bars will follow quickly.
The vision of hyper-local in-store marketing is to recruit the consumer to opt for the use of the platform via an application in the case of iBeacons and via a single subscription to Wi-Fi. Then, when the consumer returns to the store, the marketing program can go smoothly.
This is a still relatively new concept, for which best practices and optimization of results remain to be established. But examples could be the offering of coupons in-store, the promotion of special offers based on outside variables such as the weather (ice cream on a hot day, for example) or specific messages when they leave the store.
The platform can also be linked to an existing or tailor-made loyalty program, which can further personalize promotions based on previous purchases or models, such as reminding parents of babies to stock up on diapers. Electronic in-store signage can also be used to display different messages to specific consumers as they pass.
An immediate need for retailers who are testing these techniques is to establish guidelines so that messages are seen as useful, as opposed to frightening (“How do they know I’m pregnant ?!”) or intrusive in terms of volume – I think we can all agree that a constant barrage of phone beeps would quickly become annoying.
What about the future? We know that many customers are already researching their purchases online, which increasingly means “on mobile” before they go to a store. As consumers can be tracked both digitally and in the real world, we will certainly see an increase in in-store advertising used in in-store retargeting campaigns – a technique that will need to be used with caution to avoid that Big Brother feeling. lurking behind freezers waiting to pounce in front of frightened shoppers.
Russell Buckley is a UK government adviser and technology investor
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