Not paying attention to location data simply because you don’t run a physical store? If that’s the case, I’d like to make an argument for paying greater attention to location. Simply put, location needs to matter to all consumer brands. It’s not just for brick-and-mortar retailers -- it’s for everyone.
Even if you’re not a true brick-and-mortar retailer but do plenty of selling through traditional offline retailers, location data can be immensely helpful to your brand. After all, it is imperative to understand what the retailers that carry your products are doing to understand foot traffic in their physical spaces. It’s also important to be able to reach your consumers wherever they are, which requires a detailed knowledge of customer movements and behaviors.
One brand that has used location data to great effect is Herradura Tequila, which teamed up with Foursquare to create a location campaign designed to raise awareness of the brand among drinkers of premium spirits. Foursquare took the list of places where Herradura is sold and used location data from mobile phones to target ads to people who had been at or near those stores in the past or were likely to buy premium alcohol.
Makers of alcohol don’t enjoy the same direct relationship to the consumer that, say, brick-and-mortar retailers do. As a result, campaigns such as these that raise awareness are a crucial part of their marketing strategy. All in all, the Foursquare campaign led to a 23% lift in visits to stores that sold Herradura among people who were shown the ad, compared to a control group. Because Brown-Forman, the company that owns Herradura, has no retail locations itself, it was unable to see how many people bought the tequila in reaction to the ad; nevertheless, as Foursquare’s senior director of brand partnerships, Leah Malone, noted, “Visits are a proxy to sales.”
Herradura’s example shows that not having a brick-and-mortar retail location is no excuse for not using location data. Location data offers all brands important insights into how their target consumers shop, which, in turn, affects how they market themselves to those consumers. In Herradura’s case, it could see which type of content does better at getting people to shop, whether it’s a video, banner or pop-up ad. The company could also know where people were more likely to shop in terms of physical location and type of store and learn where else potential buyers of Herradura are likely to go, thus allowing Herradura to fill in the outlines of its ideal consumer.
Brands can also use location data as a core component of their business strategy. GasBuddy is a popular mobile app that relies on crowdsourced data to help users find the best gas prices in their area. The app relies entirely on users reporting the gas prices in their area, which requires them to share their location. In exchange for this information, users can see what other people are paying for gas and help them save money. All told, the app has 12 million active users and has been downloaded about 70 million times. In this case, location data is not being used for purposes, but it does showcase some of its wider applications and potential monetizations.
Brands engaging in e-commerce, too, have much to benefit from mobile data. It’s been commonplace for years for marketers to look at “owned” data such as average transaction size, number of transactions and time on site in order to market to consumers. This is information that is freely and sometimes explicitly given up by the consumer. With the rise of mobile location data, there is a treasure trove of implicit data being created that can give deep insights into shopper behavior that is accessible to third-party data providers.
All of this mobile data is crucial for brands that are interested in marketing to their customers in real time. Personalized ads have proven to have a high ROI, and using such mobile data is a great way to personalize your brand. Moreover, location data doesn’t just help your brand sell to existing customers; it can be a powerful asset in identifying potential new audiences for your products. The richer the location data is, the greater the goldmine it can be for marketers.
For companies that have products but do not or are unable to sell them directly to the consumer, having location data is a great way to get information on a consumer that they might not have had access to otherwise. Every marketer is looking for ways to personalize their advertising without appearing intrusive. Moreover, these marketers are looking for easier ways to do this at scale. Today’s consumers typically understand that sharing their location data with providers they trust can lead to more relevant shopping experiences. If Brand X uses location data to serve up swimwear recommendations to customers in Florida and parkas to customers in Alaska on the same day, then all parties win.
Published on Forbes.com