Location-based marketing – the importance of correct addresses

We’ve seen a general shift towards cohort or audience-based target marketing based on location data. Asif talks about the multiple current uses of address data in ABM and what we can expect to see in the future.

Blog: The Location-Based Marketing Association

Location-based marketing has become a critical part of the marketing mix for brands. It has evolved significantly over the years, from sandwich signs on the street to sophisticated geolocation campaigns. On a recent episode of ASK THE EXPERTS, Asif Khan, the founder and chairman of The Location-Based Marketing Association (LBMA) highlighted several trends that have emerged in the space and the key role location data plays in enabling the industry and driving innovation.

The LBMA is an international organization that operates throughout Europe, Asia, North America, and Latin America with membership including location data companies, brands, and agencies. It offers various activities and events for members, including physical conferences, research reports, and competitions for case studies around the world. “One way to get involved with the LBMA is through its bestretailcases.com platform, where you can submit a case study or learn about the latest trends and best practices in location-based marketing,” said Khan.

Hot Trends in Location-Based Marketing

Khan defines location-based marketing as the intersection of people, places, and media. Since founding the LBMA in 2009, one significant shift he has identified is the move from one-to-one engagement to cohort-based targeting. Rather than sending individual coupons or offers, marketers are building audience profiles based on location data and targeting groups that match certain criteria. This approach allows for more efficient and effective campaigns.  Khan explained that a brand might observe “a whole group of people and look for them to match certain criteria. So people who've traveled from the airport twice this month and went to Home Depot and maybe Starbucks three times a week. You can build an audience profile and then target that whole group all at once as opposed to an individual one-to-one engagement.”

Another trend is the rise of retail media networks or RMNs. Retailers like CVS, Walgreens, and Walmart are building media networks within their stores to engage customers with relevant content.  This approach allows retailers to monetize their physical space and engage customers in a more targeted and personalized way.

The emergence of Web 3.0 and the metaverse is also a significant trend in location-based marketing. Marketers are looking at how they can track people's movements in the virtual world and overlap that data with physical location data.  “Is it the same people, is it different people?” Khan asks, “and what are the opportunities to reach and engage?”  This approach opens up exciting new opportunities for brands to reach and engage with customers.

Know Your Location Data

One of the biggest challenges in location-based marketing is ensuring the accuracy and quality of the data. The LBMA regularly publishes research studies on the topic. According to Khan, even though there has been some improvement over the years, “there's a lot of fake data, there's a lot of bad data, there's a lot of duplicates in what brands are buying and using.”  With the recent privacy changes from Apple and Google, data providers are incentivized to create even more fake data, which makes accurate data even more critical. “It's a challenge,” he said.

Khan emphasizes the importance of transparency and understanding the quality and ownership of data when dealing with data providers. "If you're a data provider, be really transparent about the quality of your data, how you source that data, and the ownership of that data," he recommends.

Khan also noted that the management and sourcing of location data have shifted over the last decade. The move away from app-based or SDK-based data to server-to-server approaches is one significant change. Sensor-based data collection, such as beacons, and transaction data are also becoming more popular as alternatives to app-based data.

Khan shared some of his favorite use cases for location-based marketing. He highlighted Perfect Corp, a company in the space of AR-based virtual trying on of makeup, and Sally Hansen, a cosmetics brand, as examples of using technology to create experiences in-store. “Using technology to create experiences in store is a huge trend, number one. It's incredibly important for the survival of physical retail to make it experiential. When I think about retail, it's not a location, it's an experience. And if it's not an experience, then why are you going there?”

On the B2B side, Khan mentioned Wipro's work with BestBuy using smart shelving and computer vision detection to monitor real-time inventory and product movements as a data analytics play. In addition, Khan talked about retailers creating digital twins of their stores for B2B purposes.

Rebirth of QR codes

Khan also sees the rebirth of QR codes as a significant trend in location-based marketing. The COVID-19 pandemic has brought back the use of QR codes, and Khan thinks that this and other tried and true technologies will continue to be an essential part of location-based marketing. “We are seeing a reemergence of beacon technology and sensors inside of these networks of retail stores or restaurant chains.” He believes that the next phase of QR codes will be more dynamic and interactive, providing consumers with a richer and more engaging experience.

Location-based marketing is constantly evolving, and the future holds exciting opportunities for businesses that want to leverage the power of location data. From beacon technology to QR codes and beyond, the possibilities are endless. Despite all the exciting developments, Khan reminds us, "having quality geocodes, having accurate data is incredibly important" for successful location-based marketing campaigns. So while AI-driven, digitally-infused, micro-targeted location-based marketing is a long way from sandwich signs, it's still rooted in the basic principles of getting to the right people at the right time with the right offer in the right place. And that only works if you have the right location data.