#LSA18: Where is Location Going?
May 2, 2018 | Contributed by: Jessica Meyers
Location data has evolved from a pin on a map to a multi-faceted marketing tool that can help businesses drive ROI and performance. GroundTruth, who’s been at the forefront of this category, launched a disruptive “cost per visit” ad model in 2017, as well as a “cost per SKU” model for CPG brands earlier this year.
CEO, Sunil Kumar and CMO, Eric Hadley sat down with Greg Sterling at LSA18 to discuss the evolution of location-based marketing and where the industry is headed. Here are three key takeaways from the session:
Location is Intent
Marketing starts with understanding where and how consumers spend their time. Today, one-third of all consumer time is spent on a mobile device. This is even greater for the younger generation who spend nearly 60% of their time on mobile. This addiction to or “love” for mobile has led to a massive growth of location services and thus, adoption of location-based marketing by advertisers.
“When people think mobile, they should think location,” said Sunil Kumar. How people spend their time on a mobile phone in the real-world is a much better indicator of intent than how people spend their time online. For example, GroundTruth noted that of the nearly 105 million users who visit McDonald’s, less than 10 million actually search for the brand online.
Location Targeting Will Continue to Become More Predictive
When location first hit the market it was all about place targeting, reaching mobile users in or around an address. This eventually evolved to audience targeting, reaching users based on where they’ve been — not their proximity to a location. How we measure success has also changed. Clicks on an ad or a secondary action rate, such as click for directions, still have their place. However, thanks to the growing scale and accuracy of location data, marketers are able to measure whether an ad resulted in a store visit or sale. This ability to tie advertising with key KPIs is what led GroundTruth to develop performance-based buying models, such a “cost per visit” or “cost per sale” that advertisers know today.
Furthermore, as location targeting becomes more sophisticated, it’s also becoming more predictive in nature. Not only does location data allow marketers to accurately identify and reach potential customers, as Sunil noted in his demo of GroundTruth’s Discovery platform, but it allows them to analyze behavioral patterns and match them to specific places all around the world. This ensures that brands can reach their intended audiences at exactly the right time and place.
Adoption of Location by SMBs Will Grow
At one time, location targeting was reserved to large, enterprise companies who had the budget and resources to invest in mobile. Today, even small- and medium-sized businesses (SMBs) can harness the power of location data thanks to the emergence of self-serve platforms like GroundTruth Ads Manager. As Hadley pointed out during the Q&A, “SMBs have already learned how to maximize search and social, however, location presents a whole new opportunity for SMBs to drive ROI.” A great example of this is from Ted’s Montana Grill, an early adopter and advocate of Ad’s Manager. The restaurant chain, which has over 45+ locations across the United States, has seen a 12x return on ad spend since launching location-based marketing campaigns. Both Kumar and Hadley expect to see more SMBs and small agencies follow suit.