Study: Spend in location-based advertising 'significant' despite knowledge gaps

Study: Spend in location-based advertising 'significant' despite knowledge gaps

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More than half of marketers surveyed are spending SG$10,000 to SG$100,000 annually on location-data based advertising, according to a new APAC study by Blis which interviewed 150 marketers. However, most respondents also revealed that they are unsure as to how best to utilise and measure the effectiveness of location data in their campaigns.

The study, which surveyed heads of marketing from retail and travel brands as well as marketing agencies, found that 31% of marketers spent between SG$10,000 and SG$50,000 annually on location-data based advertisements. About 21% spent between SG$50,000 and SG$100,000, and 11% spent above SG$100,000. Of those spending more than SG$100,000, only website development (19%) and email marketing (15%) received greater investment.

Retail and travel applications

According to the press release, the "significant" spending arose from retailers' efforts to keep up with evolving consumer habits and "meet demands for personalised and perfectly timed experiences". Location data was largely used to help marketers directly target competitor stores through geo-conquesting (53%) and win over shoppers with geo-fencing (51%).

Meanwhile, 48% of the marketers use it to chart the correlation between store traffic and sales, 43% to track return on advertising spend, and 38% to gain insight into store location performance. As part of their omni-channel strategies, 42% of those surveyed target shoppers based on online and offline behaviour data and 35% of them also use location data to close the online to offline attribution gap.

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Meanwhile, travel marketers thought that the inspiration and booking traveller journey phases are the two most important opportunities for location-based marketing to deliver personalised adverts and messaging. Other phases include searching for providers, the travel experience itself, and sharing reviews and travel stories upon return.

Marketers across the board are also using the data to measure relevance and attribution, with 67% using it for out-of-home buys and 63% for television ads.

Knowledge gaps

However, not everyone has fully mastered the use of location data. Difficulty evidencing ROI was surfaced as the main challenge (57%), while 51% cited a lack of established standards, metrics and guidelines. Additionally, 49% pointed to a lack of scale and 45% believed there was a lack of transparency into location data sources and methodologies.

Blis CEO Greg Isbister said: “Understanding real, human behaviour by analysing mobile location data gives brands the truth about what people actually do. And it is this real-world intelligence that delivers real consumer engagement and a measurable sales uplift.”

However, he said it is important that brands choose a partner who is "scrupulous with its data sources". "Being transparent with the veracity of the data, scrubbing it for inaccuracies and ensuring it complies with GDPR helps build certainty that the insights gleaned can be trusted,” added Isbister.

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