The Race to Location Based Advertising (LBA)

By Dave Latham, Fuel Contributor

In the digital space, we’ve built applications, technologies, and companies; really an entire industry dedicated to providing marketers with the answer to ‘who’ they are attempting to reach. Contextual display, search engine marketing, behavioral targeting are all focused on telling your story to the people who are most interested in what you have to say. In solving the ‘who’ question, we have stumbled upon answers for the ‘how’. Anyone reading this has already developed an internal justification for the ‘why’. So that leaves us with two questions: ‘Where and when?’

We can potentially answer these questions with similar mediums, technologies and strategies. I’d like to focus on the former, as the industry has seen an influx of extremely bright and passionate people that are making impressive progress in developing our ‘where’ expertise as marketers. This is much more than the standard geo-targeting capabilities of our third-party ad servers that we are already familiar with.

Remember the days of paper maps? Sometimes I try to imagine what it would be like to navigate the streets of Los Angeles without a navigation system, Blackberry or iPhone. In LA, it’s not about getting from point A to point B; it’s about getting from A to B as quick as possible by avoiding the traffic jams. This requires using a clever combination of freeway, surface streets, and even parking lots. But even online maps started off so simple, so basic. Then we started adding turn-by-turn directions, satellite imagery, traffic, GPS, Wifi locators, hotspots, and community collaboration on points of interest. Today, improvements in ‘where’ technology allows you to take a virtual stroll down Michigan Ave. in Chicago, from anywhere in the world.

As great as these developments have been, it turns out that this is only the beginning of our obsession with location-based technologies.

The proliferation of mapping applications paired with the emergence of social networking has led us to a turning point. It started with MySpace and Facebook profile updates. We started to learn that people actually took interest in learning about where their friends and colleagues are and where they have been. Twitter, Dooplr, Loopt, and countless other Web 2.0 applications are proof of this concept. It began with location updates being manually entered online. From there, position updates can be done through email, simple SMS and Wifi locators. But as our cell phones continue to become more sophisticated, things become automatic.

The number of GPS-enabled cell phones is expected to triple in the next five years. According to Swedish-based research firm Berg Insight, there will be 560 million GPS handsets globally by 2012 compared to 175 million units worldwide in 2007. Also, Galileo, the European competitor to US-based GPS systems, is expected to go live by 2013. But, the delay in launching the Galileo system hasn’t hindered GPS being rolled out into European handsets. With a bright future ahead, the already recent growth has opened the door to a proliferation of location-based services in the palm of your hand.

Think beyond locating yourself on a map to the possibilities of geo-relevant content. San Francisco-based LightPole Publishing is building partnerships with content providers to bring information to your cell phone relevant to your exact location. Imagine standing on a street corner in Boston and having access to reviews of all restaurants, night life, cultural events, and even homes for sale within a 10 block radius. LightPole calls it “mobile discovery.”

Mountain View, CA-based Loopt has taken social networking and added a location-based twist. Their service is now available on every cellular carrier in the US; the iPhone app recently surpassed Facebook and MySpace as the 20th most popular on iTunes, according to Apple. The Loopt application allows the user to broadcast their location in real-time to friends, attach pictures, post messages and connect with friends nearby. In early 2008, CBS Mobile struck a deal with Loopt allowing them to serve location-specific ads to opt-in Loopt members on CBS’s network of mobile sites. Others aren’t far behind. 

Not to be left out, Yahoo has been working on their location-based strategy over the last few years. This strategy grew by leaps and bounds last year with the launch of Fire Eagle; a geo-location platform capable of sharing your position with multiple online applications all at once. Fire Eagle can take your location through text message, email, GPS, and other websites for distribution all over the Internet. Fire Eagle opens the door for developers to include location data in their applications with minimal effort or investment.

Minimal effort or investment = an explosion of location-based services online. Advertisers will need to focus on how to target their messaging more than ever as the conversation becomes even more 1-on-1. The start of the 21st century has proven that contextual advertising has incredible staying power and it’s only reasonable to assume that targeting will continue to develop with location data leading the race.

Reader Comments

On 01/28/2009, Nathan_Scripps said:

I love this article and think it is spot on.  Once I got the iPhone, location based apps became a necessity in my life… from maps and directions through Google, restaurants via Yelp or AroundMe, and I even tried my hand at Loopt as mentioned in the article.

As marketers get better at working within these newly available targeting technologies, it can improve consumer experience and ROI at the same time.

If marketers strive to create ads as content rather than interruptions, the possibilities become exciting for all involved.

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