Location Based Marketing - Could it Really Work? Part One at MobHappy


When ZagMe, my previous foray into Location Based Marketing (LBM), was shut by its investors, I wrote at the time that we were 5 years too early. This didn’t mean 5 years too early for user acceptance, incidentally, but too early for marketers and the available technology.
However, ZagMe closed 5 years ago now and I sense that the world and technology is catching up with the thinking, so I thought it would be interesting to re-examine the business case.
Whenever location based marketing is mentioned, there are usually a number of predictable reactions.
At one end, we have what I’ll call the traditional techie, or possibly the anti-marketer (not always one and the same person) who tend to run around shouting stuff about invasion of privacy and calling for damn-fool advertisers to leave us alone. “We don’t,” they say, “want marketing messages on our phones (or anywhere else, in our heart of hearts) under any circumstances. It’s Evil.
Well, unless it’s Pull Marketing, where we get to decide when we want to be marketed to - obviously maybe that’s OK.”
At the other end of the spectrum is the traditional marketer or ad agency. They know the traditional channels are dying. People PVR out ads, have spam filters and their minds are adept at ignoring marketing messages.
They need a new magic bullet and mobile marketing may be the answer.
What both parties seem to be missing is what the ordinary mobile phone user might want. So I thought I’d have a look at this and see what the role of marketing on a mobile phone might be.
Firstly, let’s bust the Pull myth. Most ordinary people don’t want the hassle of pulling down information. They want it presented to them as a seamless part of their device experience, to ignore or act on, as they see fit.
That’s not to say that there isn’t an important role for Pull - I think being able to access information to supplement other media, as an example, is a great idea. And some die-hards will always stick to Pull and that’s fine too.
But the ordinary person wants to access marketing messages without any hassle, provided that the messages will be of interest - more of that anon.
I’m also not going to belabour the the Opt In Rule here. Trying to run non-Opt-In campaigns is not only illegal in Europe, but will be anywhere where marketers try to run this type of campaign. It’s simply too annoying for recipients and too tempting for politicians to run vote-catching legislation to ban it.
Having said that, illegal or not, it’s fundamentally Stone Age marketing, akin to bludgeoning passers-by with a huge marketing club and shouting after those you miss “Oi, shithead come back here, so I can smack you round the head and tell you how much I much I disrespect you”. In other words, it’s not for reputable brands, as they’ll find out damn quickly if they try it.
So let’s assume that your user has signed up to receive LBM from you.
Yes, this is a very big assumption and leads to the first fundamental LBM question: Would anyone sign up and if so, why would they?
Well, I think we can tackle this pretty quickly. Yes, they would sign up or opt-in to receive LBM. And they’ll sign up because of the type of marketing messages you promise (and they believe) that you’ll send them.
At ZagMe, for instance, we had 85,000 people sign up to our opt-in mobile marketing channel. These people weren’t tricked into something, they were simply promised marketing messages from shops in the mall, as in “great deals on essential brands direct to your mobile – free”.
So, in fact, the really important question when studying LBM, the-answer-to-life-death-and-the-universe question of the subject, is: what kind of marketing messages should you say you’re going to send that will attract opt-in in the first place, that recipients will welcome and that they’ll respond to? In other words, what kind of messages will work? Knowing what the user wants is key to both opt-in in the first place and subsequently, optimising the channel’s effectiveness.
I’ll examine this in Part Two of this exploration and I’ll publish it later this week. If you have any ideas or feedback, leave a comment and I’ll incorporate the best in the follow-up.
Have a great week.

-->
9 Responses to “Location Based Marketing - Could it Really Work? Part One”
Feed for this Entry Trackback Address
1 Tom Hume Jan 29th, 2006 at 9:26 pm
A thought: is push marketing considered so offensive because it’s so interruptive? If there were ways to push messages to individuals without masquerading as a friend of family member (which is what SMS marketing messages effectively do, after all), would it be more welcomed?
I’m thinking of the work that many mobile operators are doing now to do with pushing messages (usually adverts for content) onto the homescreen.
2 Martin Jan 29th, 2006 at 9:46 pm
“In other words, what kind of messages will work? ”
I don’t mean to be rude, but isn’t this rather obviously the central question? Is this not the central question of all marketing efforts since the beginning of ever?
“What kind of marketing messages should you say you’re going to send that will attract opt-in in the first place…”
Just to be clear: are you talking about the marketing-of-the-service in the first place? Or the service itself? In other words, are you talking about the initial “hey, sign up for this service” call to action, or the subsequent, “hey, buy this widget” messages that users will start receiving?
3 Russell Buckley Jan 30th, 2006 at 6:46 am
Martin
Sorry, old fruit, it might seem obvious to thee and me, but it’s one that’s missed by the majority of commentators and marketers, time and time again.
In the past, marketers simply haven’t needed to concern themselves with what would be accepted or even welcomed by recipients of their messages as they were trying to interrupt people as they went about their lives, watched TV, listened to the radio etc. Therefore what “worked” were ads that were most effective at cutting through and interrupting most effectively.
If you have to ask permission from people to send them marketing, your mindset has to change completely.
As to the distinction between getting people to sign up and what you send them subsequently - they are one and the same. The justification for the first part has to be based on what you intend sending them in the second part. So they must be considered symbolically. Any approach that’s based on “hey sign up for our groovy service” without formulating what that service is will disappoint the recipient, who will feel conned and quickly opt out.
Tom - I certainly think honesty and authenticity are central to any successful service and indeed, marketing today. Trying to pretend to be something you are not, is a no-no these days. And yes, I think non-obtrusiveness might be important - you need to view the mobile as if you were a guest in an important person’s home. Respect the environment, don’t outstay your welcome, ask before you use the facilities and don’t shit all over the carpet.
More in Part 2.
Keep the comments coming.
Russell
4 Rudy De Waele Jan 30th, 2006 at 2:02 pm
Good you dig deeper in this subject, it’s definately worthwhile.
Before to ask oneself “what kind of messages will work” we need to gather more information on behaviour of different kinds of communities and their people. To get this information you need the permission of course.
The only ones who can push marketing to their subscriber base with permission (and expect % return) are the operators. What is lacking to create sustainable mobile marketing is the existence of profiles of groups of people (and their behaviour). The operators are not opening their subscribers list for 3rd parties (luckily!) and will not do so in the near future unless the 3rd party creates a service himself -now becoming more and more accessible through the mobile web, for example, and that’s the new thing that’s going to open new possibilities here.
I am sure people are willing to give their permission to certain aspects of their profile (ex. music, movie prefs) as they do on the internet, if the service, or community they ‘belong’ to, is reliable and promises not to mess up with their data.
The absence of such services and communities in mobile is pathetic as of now if you look around (apart from some starting experiments in the good direction). Once we have those in place, there is going to be space for mobile marketing, and it’s going to be different and more powerfull as to anything we have known before.
But what people tend to forget is: marketeers need insight and numbers on the people they reach on radio, on TV, in print and other media, this is going to take some more time still.
So first things first… Start building those communities!
On the other hand, I just received my latest mobile browsing bill from my beloved operator. It exceeds my average ADSL flat fee/month for only a couple of times per week condensed mobile web surfing, as of now, I just can’t see a mass market starting to surf the mobile web with these pricings. Antime, anywhere, anyhow? Yes but at an affordable price!
5 scott shaffer Jan 30th, 2006 at 2:50 pm
“So let’s assume that your user has signed up to receive LBM from you”
The key ingredient needed for location based advertising, is your location. Identifying the users location via GPS (or other triangulation technologies) will play a vital role for this industry.
6 Jim Parsons Jan 30th, 2006 at 11:20 pm
At the risk of sounding like comment spam (and believe me this is not) the Navizon Wireless Positioning System (which blends GPS, WiFi and GSM/TDMA Cellular signals, providing accurate mobile geolocation for Symbian/PocketPC device platforms) already enables everything this thread is talking about… through it’s implementation of “GeoTags” for geoblogging and the linking of meta-data with GPS location.
In my view Location Based Marketing messages don’t necessarily always need to be pure advertising — they can easily and inexpensively be offered up in the form of: local public service, public safety or local economic development initiatives. Web 2.0 style “social tagging” is already exploding within our user base… and the list of commercial possibilities goes on and on.
The answer to the question posed in this blog post is simple:Location Based Marketing will work if the Location Based information offered up is actually USEFUL to people it’s being offered to. Period.
As for Rudy’s call to action for building communities (above):Navizon users now number 20,000 in 20 countries and we’re doubling in size every month.
7 Jacomo Jan 31st, 2006 at 5:54 pm
Location Based Marketing (LBM)will flourish under the umbrella of these new Metro Area based Wireless Mesh Networks that have 2 of the key ingredience (system components) to make them work.1. A wireless Mesh Network have a series of Wireless Nodes located on Poles along major and select side streets. By definition they are a fixed reference point usually broadcasting a WiFi based signal 1000′ around the node.2.These nodes connected back to a Central Data Center where a LBM server can be deployed that recognizes (continually monitors) the location of the Wireless subscriber with reference to those surrounding Nodes as they roam into an area and knows what advertisers want to advertise to them. By creating a Splash Page or Ad insert and broadcasting it out to the subscriber on the Mesh Network they make immediate contact with that subscriber-This is the real definition of Bullet marketing.Just watch this flourish, especially when the subscriber is using a large screen Laptop/PDA or the new large screen Smartphones with WiFi capabilities. These large screens/displays are key here and will allow very high quality graphics/Video content to be delivered-Big premiums.
Jacomo
8 Sceptic Jan 31st, 2006 at 10:48 pm
You must be kidding. What on earth would make me want to get marketing messages on my cell phone -location based or not?