Handled deftly, location data deeply enhance marketers’ ability to plan, measure, and attribute ad spend and to optimize campaigns for real business objectives.
But that deftness doesn’t always come easily. Many marketers have become skittish about using location services in their digital advertising initiatives because of Europe’s GDPR and California’s CCPA, a similarly sweeping privacy law going into effect in 2020.
Marketers are also unsure they can trust location data. A study by verification company Location Sciences found that 65% of a typical location-based advertising budget used in the U.S. and U.K. is wasted on “poor quality” or “mistargeted” location data, and that 36% of apps using GPS provide fraudulent locations.
Improvements In Location Data
In fact, GDPR has improved the trust marketers can place in data derived from location. Because users have given their consent to be tracked, their data are both permissioned and more accurate. Reputable location services have been able to rebuild significant data sets after scrubbing them to comply with GDPR, which went into effect in May of 2018. The data sets are now large enough to give statistically strong indicators that can be matched with other data on target consumer segments.
Those data can help improve efficiency and effectiveness well beyond more superficial KPIs. They enhance the ability to attribute messages to real-world impact, such as to the amount of footfall in retailers’ stores. Integration with app SDKs can help show customers’ journeys. Location technology offers a “profound level of insight,” reporter Liz Weinstein wrote in Business 2 Community . It can identify “sweet spots” to deliver messages that inspire store visits and help show where customers travel after they visit a location, giving a fuller picture of their shopping habits.
Marketers can use the data for geofencing in order to negatively target and exclude undesirable locations, or to facilitate “conquesting” by enticing shoppers away from competitors’ locales. They can target consumers who may be webrooming or showrooming, and use location-based insights to help make decisions about ads’ creative elements.
Marketers Must Scrutinize Partners
It is precisely because location data are so powerful that they may cause fear and hesitation among marketers. Consumers who let their locations be tracked are providing very personal information about who they are and what they do. Location mapping can verifiably show where someone sleeps, eats, works, exercises, and shops, even with whom they spend their time.
Because of that potential to intrude, marketers must tread lightly, demanding transparency from partners to ensure they handle location data properly by anonymizing, hashing personally identifiable information, and using strict protection protocols. Marketers should be on the lookout for anything that appears fraudulent. “Sweat the bidstream details” and make sure geographic coordinates look right, tech reporter Patricio Robles urges in an article for Econsultancy.
Marketers must also carefully vet partners for their scale and scope. Does a partner work across borders, understanding local strictures and customs? Can their data be matched to other uses, such as for digital out-of-home, shoppable, or audio advertising media? Do the data incorporate GPS or simply rely on IP addresses (which are less precise)?
It’s also crucial to ascertain whether partners are frank about their limitations. Because location-measurement technologies may need minutes of “dwell time” to get an accurate read, people driving by or who are using slower devices may not be measured precisely. Many apps gather location data only when the app is open and in use on someone’s phone. Crowded locales can muddy location accuracy, as can multistory malls. To be measured accurately, a location’s geometry needs to match the boundaries of the parallel data collection.
Marketers should scrutinize suppliers, think skeptically, investigate methodologies and ask very specific questions, such as whether added foot traffic can truly be attributed to messaging.
To Personalize, Use Finesse
Marketers must also be careful to achieve personalization with finesse, to not overstep the bounds of good practice and taste. Here’s an example based on a real-world case: One shoe company wanted to know where people who saw the brand’s ads spent their recreational time. Location data was able to show whether the targeted consumers went to stadiums, played sports on athletic fields or indoors, or perhaps stayed at home when local games were broadcast.
In such a case, it was probably fine to personalize messaging to user segments constructed from the location information, such as by showing activewear ads to the athletically minded or tailoring messaging around fans’ favorite local teams or local sports stars. But if the company were to figure out that I’m a fan of the Arsenal soccer team and then send me ads showing that they also know where I kick the ball around on weekends and that my feet require wider boots, well, that would be jarring at the least and perhaps even creepy.
As a final step in ensuring the accuracy of location data, marketers should discard outliers, such as when a sparsely populated area such as central Kansas is overrepresented, or when store visits are recorded during hours when the mall was closed! For campaigns targeting travelers, the data partner should always, for instance, sift out taxi drivers at airports; they are not flying anywhere that day.
One of the most important and complex decisions a marketer has to make is how to deploy location data — and with which reputable vendors — in order to meet business objectives while steering clear of liability. Used correctly, location data provide a powerful tool that can help create rich and valuable experiences for consumers and brand advertisers alike.