The dos and don’ts of location-based marketing

It’s a lot to keep up with.

Recently, one of the most talked-about digital marketing trends has been location-based insights and targeting.

Thanks to incredible handheld and wearable devices, marketers now have insight into where consumers are and what they are doing at any given moment, giving us the opportunity to reach them directly in real-time. You can now access almost unlimited data on an almost unlimited number of devices. Great, right?

Not really.

Having access to location data is one thing, but unless marketers can properly grasp how to use that data, they’ll be left wasting a lot of time and money.

DO get creative with your insights

When used correctly, location-based insights can give far more demographic data than one may assume. It’s one thing to know where a person is, or has been, but it’s another to use this information to infer basic information about their identities.

Ask yourself, what else can you determine by understanding a location? Age? Income? Interests?

For example, if you know a certain segment of consumers spend approximately 3 hours a week shopping at Whole Foods, an hour a month at Nordstrom and buy a daily coffee from Starbucks, it’s a fairly safe assumption that they fall into a higher income bracket than another group that predominantly buy groceries at Stop n’ Shop and go to Dunkin Donuts twice a month.

DON’T feel like a stalker

With all this talk of location, it’s hard not to feel like a bit of a stalker. Well, don’t.

Using mobile movements to determine demographic information and create audience segments does not infringe on anyone’s rights unless you’re using the information to build a shrine of someone in your bedroom closet (which is a little bit stalker-y … so you shouldn’t do that).

In fact, one may argue that with location capabilities on almost all cell phone apps – Camera, Facebook, SnapChat – consumers have begun to expect to see their ads tailored to their needs and interests.

So really, it’s a win-win. Marketers are able to execute campaigns more effectively while consumers are served ads that truly matter to them.

DO target smartly

I recently had a client who wanted to use location data to target a population who would be interested in romance novels about cowboys. Very specific, I know.

Now at first this seemed like an easy one: simply target states and cities that traditionally embrace cowboy culture.

However, blanketing Texas and other red states felt too much like an old-school flyer campaign and didn’t exactly feel like the best use of our client’s spend.

Instead, we used the location of mobile devices to target individuals who had attended rodeos in our target states. Once these devices had left the rodeos and were near a store that sold our client’s product, we served the ad. This ultimately resulted in phenomenal sales.

Clean, simple and effective.

DON’T be fooled

Location is the next hot thing in industry insights so naturally, everyone will claim to be an expert. Be sure to properly vet data providers before tossing away thousands of dollars. Ask to see case studies and garner a proper understanding of where all data is coming from.

Are you simply paying for data lifted off Google Maps? Does the provider have the ability to collect and customize data according to your needs? These questions should be answered well before any contracts are signed.

To solidify your trust in the location data and capabilities you’re receiving, use a vendor that offers detailed reporting tools. This way, you have full accountability for every dollar you spend and you can ensure campaigns are optimized in real-time.

DO embrace the power of pattern

Sometimes patterns in data can be just as valuable as data itself. In addition to using data points to infer demographic information about consumers, connecting these points is crucial.

For example, by studying the number of daily hours spent at specific locations, you can determine where a consumer works, plays, shops, and lives. This is especially helpful in major cities where there are many commuters.

This can be another powerful targeting tool for universities looking to isolate on and off-campus students, restaurants looking to target lunch and dinner crowds, and brands overall, who simply see the value in knowing more about the daily lives of their consumers.

Overall, it has become clear over the past few years that location-based marketing is here to stay and that it can be a very valuable tool. Now, all that remains to be seen is whether or not marketers will learn to properly use the technology to maximize the effectiveness of their campaigns.

Geoffrey Rotstein is the CEO of Toronto-based digital marketing agency, EQ Works. He tweets @GeoffRotstein