Location Based Advertising - Connecting the Dots
Posted Wed, 6 May 2009 12:52:28 EDT by George Perros
In discussions about location based services, it doesn't take long for the conversation to migrate to location based advertising (LBA). The usual issues then crop up - consumer privacy concerns, the absolute need for explicit device owner consent (opt-in), the importance of insuring the ads resonate with the recipient, the need for creating a pleasant experience for the recipient on a small form-factor display, and somehow tying all of these requirements together in a program that increases revenue for advertisers.
For many of those outside the advertising and marketing industry, LBA is often equated with so-called geo-fencing - a system in which an ad server knows when an opted-in mobile device user crosses a virtual boundary that places the user within the proximity rule for receiving an ad for a specific business nominally located in the center of the geo-fenced boundary. In reality, the geo-fencing model in the pure sense is not likely to be a major factor in LBA for the foreseeable future, for several reasons. One very important reason is available technology. the geo-fencing model assumes the device user's position can be known by the LBA server on a continual or semi-continual basis. Otherwise, a potential LBA recipient might wander through the geo-fenced area without receiving the ad. GPS chipsets in mobile devices do not allow for constant calculated positioning due to device portable power limitations.
While there are alternate positioning technologies available, they have their own issues. Network Cell ID is deemed too inaccurate in all but dense urban areas, and there is also the issue of network capacity if subscriber devices are constantly requesting location information. WiFi has not yet been proven to be reliable for LBS applications. Inertial navigation using mobile device sensors - perhaps the most promising interim GPS fix positioning technology - is only in its infancy.
Beyond positioning technology, there is the issue of how LBA can fit into a promotional campaign. Advertisers have a certain way of making media buys. Typically these buys are made with the goal of increasing consumer awareness. LBA on the other hand is a special case of direct response advertising, so early LBA enthusiasts have had to educate marketers on the role and potential of LBA. Several companies are now connecting the dots of what's out there - in the words of Dave Matthews ' the best of what's around' - to create a cohesive service for advertisers with LBA at its center. These companies include 1020 Placecast and Acuity Mobile. The bottom line and ongoing challenge for LBA will continue to be satisfying the goals of advertisers without alienating LBA recipients.