Brands have been using location data to improve marketing campaign targeting and clearly measure subsequent in-store visitations for a few years now. But location data has the potential to inform an entirely new set of business decisions.
Given that nearly two-thirds of Americans are smartphone owners, brands can't afford to ignore mobile devices when trying to better understand their customers. Mobile provides a unique lens into consumer behavior — a connective layer as consumers move between the physical and digital world.
This new understanding reveals not only where people are eating or shopping but also what they’re purchasing in stores, watching on TV and how their commute — from work to home and vice versa — changes their purchasing behaviors.
While location data traditionally guided media decisions because of its ability to reach and engage with consumers, marketers are now using it to connect with customers on a much deeper level.
Below are three real world examples of how mobile data is transforming the way business decisions are made:
Making Smarter Retail Site Selection
Many retailers have dozens — or hundreds — of locations spread out across the US, each carefully researched, vetted and placed to appeal to local audiences. As retailers extend their reach to new territories, and competition for space intensifies, the question of pinpointing the optimal site for retail location becomes crucial.
Where to place the next store can be a multi-million dollar decision. Most retailers, however, base these decisions on often-outdated census or household data. Until now.
With mobile location data, retailers can analyze consumer traffic patterns, understand specific behaviors during different times of the day and factor in customer segment purchase preferences, all to predict which site locations will best attract new visitors and steal competitor traffic.
Location Data Modernizes Out-Of-Home Advertising
With location data, brands can understand the difference between where people live, where they work, and how they behave in between.
Doing so yields powerful insights about whether consumers are, for example, going to a store for a quick visit right after they finish work or making that location one of their regular shopping destinations on a Saturday afternoon. This has big implications for average shopping basket value and same store sales forecasts.
As such, one of the more conventional ad channels — out of home (OOH) — is ripe for transformation by mobile data. Understanding how consumers travel makes it a natural fit for the medium, which accounts for $2.25 billion in ad spend.
Planners for OOH have typically cast a wide net to expose the most consumers to their message, focusing broadly on locations with high consumer density. Armed with a better understanding of where audiences with particular interests congregate (e.g. their places of entertainment or dining preferences), can better inform all types of OOH decisions, like where and when a brand should place displays on public transportation, airport terminals and more.
For example, a major airline brand was seeking to find and target a new audience segment that held no allegiance to any one particular airline, an audience they termed “splitters.” It used mobile location data to analyze audience movement and identify travel routes to its airports. With this information, the airline was able to target this particular audience by optimizing specific billboard locations, down to the side of a highway. The brand was also able to tie special offers via mobile to those billboards, aligning complementary brand messages on smartphones to times and places most likely to have a positive effect with the “splitter” audience.
Going one level higher, the airline was able to effectively target audiences during specific times of the year that they traveled, aligning advertising within the airline terminal itself to appeal to those groups and, in turn, attracting new customers.
Going Cross Channel to Boost In-Store Visitation
Despite the proliferation of e-commerce, a majority of sales are still made in physical brick-and-mortar locations. With location data, brands can measure the effectiveness of using marketing channels like TV, mobile, desktop and OOH advertising in tandem to drive results in physical locations. Marketers can also connect location data to CRM systems to prove unequivocally that ads are resulting in actual purchases.
With consumers now constantly on their smartphones, they’re leaving digital bread crumbs for marketers to follow, revealing spending behavior and clues on how to best meet their needs at every point of the purchasing journey. As brands face more pressure to stay competitive and better interact with on-the-go customers, human behavior has become the asset that gives them that tangible edge.
Title image by Atlas Green