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"Location is incredibly important, and it's getting more important over time," says Joe Laszlo, senior director of the Mobile Marketing Center of Excellence at the Interactive
In fact, location-targeted mobile ad revenues are expected to grow from $4.3 billion in 2014 to $18.2 billion in 2019, according to BIA Kelsey. That's because customers today expect speedy service, personalized promotional offers, and relevant messaging at the right time and place - all of which can happen by using location data.
"Mobile's ability to bridge the gap between the physical and digital worlds, along with better location-based data analysis, have made it the means for defining consumers and understanding specifically when they are most receptive during the purchase journey," says Duncan McCall, CEO and co-founder of mobile consumer intelligence company PlaceIQ.
But many marketers don't realize that location data can be a mixed blessing: It can help brands compete in a crowded advertising arena, but using data the wrong way can be a serious blow to a brand's reputation ... and bottom line.
Reasons location data fails
Marketers need accurate information to pinpoint consumers' digital activity and make location data-driven marketing campaigns successful. But unfortunately, studies indicate that more than half of mobile location data is inaccurate.
The quality of GPS data, for example, can dramatically degrade indoors. While cell triangulation data can identify user location within a broad area, such as a zip code or city, it's also less precise. Registration data is limited in relevance to a mobile user's home zip code, and only at the moment of registration. Even IP addresses can change significantly from the actual location of a mobile user. Only Wi-Fi data promises high levels of accuracy and precision with its ability to identify user location within 10 to 100 meters of a signal.
A report from the Mobile Marketing Association offers a laundry list of variables that negatively impact location data quality, including a "lack of accuracy standards and market education," "urban density," "inaccurate interpretations" of location data that have been translated into a latitude/longitude coordinate, and poor "data freshness."
Innovative technologies that promise to deliver very accurate and precise data are emerging. But there are no set standards around how sellers, such as publishers and mobile ad exchanges, should be collecting and using location data. This puts brands in the difficult position of having to simply trust their location data provider.
Inaccurate location data causes such problems as mistaking cellular towers for actual consumer locations, improperly measuring store visitations, and misattributing behavioral attitudes. Imagine if a brand continuously sends a consumer a digital coupon for a restaurant that doesn't have a location within a 50-mile radius of the individual's home; eventually, it will alienate that consumer.
Fortunately, there are ways to improve location data accuracy. One the best answers is technology that can process opted-in movement signals for millions of devices and attribute each one to a specific latitude/longitude and unique device ID.
Combining location data with other sources of information can also help target audiences more effectively. These steps will continue to allow location data to have a profound impact on how brands reach target reach and engage consumers - and drive marketing campaign ROI.
This post is sponsored by PlaceIQ.
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