Location Data is the Oil for Retailer Conquest
E-commerce has expanded the retail sector’s battlefield to beyond the physical store. While e-commerce has been at the center of retailers’ growth plans, expanding physical shelf space is still crucial to marketers. As someone who used to work in the retail sector, I know that just three feet of additional shelf space can result in 10 percent revenue growth for a marketer.
The war for shelf space is now inextricably linked to the war for digital space. The impact of endcaps in store aisles critically influences and is in turn impacted by the growing range of virtual message extensions outside stores on every consumer's mobile screen. These messages on screens as well as in store aisles are informed by consumer signals amassed and dissected from parking lots, train stations, airports, gyms and malls. These signals have become invaluable to target an audience at the right place, at the right time, honing in on people’s specific interests and distinct shopping behaviors.
If the key to 21st century marketing success is via the conquest of online-offline integration, then location-based data technology and targeting is the fuel to fight competitively in this expanded retail arena. We will look back in another 10 years and look at the 2020s as the decade when brands primarily bid on location to engage audiences and expand their market shares. It will feel similar to how Google transformed marketing, with the search engine forcing brands to compete on keywords to mark their own brand name territories.
Yes, location-based marketing has throughout its history raised more than a few red flags around consumer privacy as well as overall data accuracy. While much of the criticism and concern have been warranted, there has also been a good deal of misinformation in the marketplace that has maintained unnecessary confusion and hesitation among brands.
Location Data and Technology in 2019 is Accurate
Traditionally, most location-based ad campaigns were conducted by gathering IP addresses within 20 miles of a targeted location. Within this radius, too many people, not interested in a brand or message, would be served ads, resulting in much advertiser waste and annoyed consumers. In 2019, with mobile ad budgets finally catching up to mobile smartphone usage, marketers are now capable of accurately reaching targeted consumers within a 11 centimeter margin of error — essentially foolproof targeting. Yet, you would be surprised to hear how many advertisers are still playing by the old rules with outdated technology that was central when we lived in a desktop world. Many marketers apparently don’t know that the technology has advanced to the point where radius targeting can be abandoned.
We now have a much more precise understanding of how people move around in the world. The ability to drive shoppers into stores truly bridges online advertising with the offline world. This advancement is a direct function of the explosion of consumer usage of smartphone apps, from which brands glean anonymized, user-consented GPS signals for hypertargeting. The average smartphone owner uses more than 10 apps daily and 30 apps monthly. Furthermore, contrary to what many people are claiming, there's no exclusive data. The entire industry is playing with the same data. Therefore, accuracy, not exclusivity should be the industry mandate. The accuracy of one’s data also has a lot to do with ensuring that best-of-class anti-fraud filtration technologies have been activated as a part of your tech stack.
While much of the digital ad industry was freaking out on the heels of General Data Protection Regulation (GDPR) consumer privacy implementation in 2018, the past year has actually shown that regulated compliance will have a healthy impact in creating a more disciplined location data ecosystem that will benefit consumers as well as the advertising industry. Because of the recent advancements in location data-gathering technology, we expect to ultimately see location-based campaigns delivering better ads than in the pre-GDPR world. The ability to generate relevance and utility for consumers in an above board manner is poised to get even stronger with literally entire cities across the globe functioning as one fully integrated marketing messaging forum.
Stan Coignard is the CEO, Americas, at S4M, the first and only unified advertising technology for marketers to manage, measure and optimize incremental visits to online and physical stores in real time.
Stan Coignard serves as S4M’s Americas CEO and has been an executive board member since 2012.
As Americas CEO, Stan oversees S4M’s operations in the US, Canadian and LATAM markets. With more than 12 years of experience and entrepreneurship in the digital and mobile ecosystem, he is recognized as a top influencer in the field.
His career highlights include Managing Director at Isobar for the Mobile Media activity where he helped multinational brands such as Kellogg’s, Adidas, Coca-Cola, and L’Oréal define their strategies.
In 2018, Stan launched S4M Speakeasy, a unique think tank bringing together shopper marketing thought leaders to experience free-flowing discussions on current industry challenges.