The Next Generation of Location Data

location data

We know how most brands use location data from mobile phones: You go someplace; the store knows you’re there; presto, you get instant coupons or special offers or more.

According to AdAge, that’s Location Data 1.0. We’ve now likely entered the stage of Location Data 2.0.

In this stage, brands don’t just know where you are. They remember where you’ve been.

AdAge writes: “Advertisers are sophisticated enough to look at location data more holistically through a wider lens. While many mobile marketers still focus on getting messages to people at key moments, the use of data showing where people have been over time is just as, if not more, important than where they are right this instant.”

How does it work? Another AdAge piece explains: “Today, mobile ad firms and location data players have expanded their offerings to include targeting and campaign measurement services that employ location data gathered over time, showing the patterns of people’s actual whereabouts. Did a mobile device show up in several fast food joints in the past month? Do people often stop at gas stations or convenience stores after hitting the grocery store? Or, on an arguably more sensitive note, was a device regularly spotted at liquor stores, bars or legal recreational cannabis dispensaries?”

One example cited in the piece came from Goodwill: “Last year, ads for Goodwill were served to people whose mobile phones had been spotted at thrift shops or second-hand stores in the past. The goal was to convince people who were cleaning out their closets and drawers to consider donating some of their rarely-used stuff to the charity group, and to raise awareness about its education and work training programs.”

Of course, this raises a key question, particularly as privacy concerns continue to grow: Will users give up their location data?

The answer may be “yes.”

Anindya Ghose is a Professor of IT, business analytics, and marketing at New York University’s Stern School of Business. He writes in Quartz that he has “collaborated with telecom providers, advertisers, and mobile-app developers to design massive real-world field experiments to understand just how quickly consumers are willing to give up their real-time location data to get personalized discounts.”

As Ghose notes: “To find out whether consumers would be willing to give up their physical location in exchange for benefits, my co-authors and I conducted a set of elaborate studies at one of the largest shopping malls in China. The mall contains over 300 stores spanning 1.3 million square feet and attracts more than 100,000 visitors per day. At the entrance of the mall, customers were offered the option of accessing free wifi service in exchange for allowing the mall to monitor their shopping trajectories and send them personalized coupons and ads as they went about their shopping. My initial expectation was that a very small number of customers would opt in to this kind of explicit data-sharing relationship with the mall. But as it turned out, more than 75% of customers opted in, basically saying, ‘Take my data and give me an offer I can’t refuse.’”

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