Mary Beth King is an account executive at Edelman Digital and has managed social media communities for various companies, including multiple Microsoft consumer business groups.
Location-based services (LBS) are applications or programs that recognize a mobile user’s location and use that information to offer deals, make social connections, find a destination or locate others. You probably don’t even realize how much you use location-based services. Every time you Google search, for example, Google uses your location to offer appropriate results. Since we’re all always on the go, mobile devices are the perfect hub for LBS and marketing companies are capitalizing on this opportunity—big time.
As the physical and virtual worlds continue to merge, brands and marketers are seeing more and more value in using location-based services to attract and engage with consumers.
Advertisers and marketers are increasingly finding it profitable to insert themselves into the LBS realm:
The growth of location-based services can be attributed to a few things:
- Increased smartphone adoption. It’s estimated that by 2015, 58% of mobile users will own smartphones. That’s a significant percentage of consumers who can potentially be reached by marketers via LBS.
- Growth of mobile advertising. As consumers spend more time on their mobile phones—especially smartphone users—mobile advertisers are capitalizing. We’re a group that wants to be engaged and because most of us smartphone users are permanently glued to our phones, we’re a rather captive audience.
- Success of new digital business models. More companies are gaining positive results from being active in the mobile space. The success surrounding digital business models is attracting other companies to the space.
- Increasing speeds and broader coverage of mobile networks. Basic supply and demand: With more and more mobile and smartphone users, broader mobile coverage is a necessity. The “Can you hear me now?” campaign is pretty close to being a thing of the past.
Even with all this positive growth and buzz, there are still a few obstacles facing location-based services in the U.S.
- Two-thirds of advertising companies aren’t using LBS this year. As the above graph suggests, this number will increase rapidly, but up until this point, adoption has been relatively slow.
- General awareness is only around 30%. Consumers need to be made more aware of LBS offerings by brands, businesses and marketers before this feature really takes off.
- Privacy concerns. Many consumers cite issues around privacy when choosing to use—or not use—location-based services. For instance, when I check in at a bar, my social networks know that I’m not home. Good thing I have a big, scary German Shepherd, otherwise there’s a pretty good chance I would’ve gotten robbed by now. (I check in a lot.)
Checking Out Some Check in Services
Gowalla and National Geographic
National Geographic's Gowalla Passport offers walking tours of cities around the world. Users can earn a special pin when they check in at all the sites on the tour. The Pike Place Market tour, for example, involves checking in to see the original Starbucks and watching the fish get thrown around.
Foursquare and MTV
Foursquare and MTV partnered to create city tours with pop culture twists, like “Jay-Z's New York,” which features Yankee Stadium and Madison Square Garden. Foursquare users can get the exclusive GTL badge when they check in at places like Ocean’s 10 and Tantra night clubs on the “Jersey Shore Cast Hottest Clubs List.” I’m not going to lie to you—I want that GTL badge.
Foursquare and American Express
Now, when you connect your Foursquare account with your American Express, you’ll automatically get checked in when you swipe your card at participating locations. Depending on the location, a certain amount of money will be credited back to your AmEx automatically, or you’ll become eligible to unlock special promotions.
Facebook’s Location Feature
Facebook’s location feature adds a new layer of information that Facebook is now collecting from its users. Facebook now knows:
- Who you are, based on your Likes, friends, photos and interactions.
- When you are, as in when you are interacting online.
- Where you are.
This means that Facebook is practically taking an anthropological survey of its users. Not only is the information interesting for users to look back on, but it offers marketers a wealth of valuable information to use in order to best-target ads and deals. With all this data tracking and media hub-ing, Facebook is sort of becoming the scrap book of the 21st century (sorry, Nana).
Why Consumers Check In
- Discovery. What’s the first thing you do when you plan a trip or get to a new city? Look for the cool spots! Restaurants, bars, attractions—they’re all at your fingertips when using a location-based service. Navigation is the number-one use of LBS, so not only do these services allow users to figure out which cool spots they want to go to, they also help navigate users there.
- Loyalty + Deals. Businesses can build brand advocates by offering special deals to frequent customers and this is a huge reason why people are interested in using location-based services. Some businesses offer deals to their Foursquare “Mayor” or the person who checks in the most at the establishment. Some businesses offer deals for first-time check-ins, or for the fifth time a person checks in. This keeps customers coming back and allows for relationship-building between businesses and brand advocates. Side note: Groupon’s mobile app automatically updates your location when you enter a new city. When I first noticed this, my reaction was, “OMG, creepy!” My second reaction was, “Oohh, sushi deal.”
- Conversation. Some people—myself included—check in just to start conversation on social networks. We’re not necessarily interested in deals or loyalty programs, but we like letting our social networks know where we are and who we’re with, because it starts conversation among friends and can encourage in-person gatherings. (Plus, I want people to know how much fun my life is compared to theirs.)
Location-based services are definitely on the rise, so try them out. My recommendation: Find a bar where no one else checks in yet and become the mayor. Then, leverage your mayorship into free beverages. Technology is a beautiful thing.
What are some of your favorite location-based services? Let us know with your comments below or on Facebook or Twitter.