In the world of mobile marketing, location-based services are one tool we are seeing more prominent in digital strategies.
Now I know you’re probably thinking what is MLBA. Well this refers to ‘Mobile phone located-based advertising’.
More specifically it is marketer-controlled information specifically linked to the users’ location.
Methods of MLBA may include beacons, walk-by promo’s, in-store experience enhancements, or service enhancements such as guides or maps.
Here is a case study of American chain Whole Foods who successfully integrated MLBA strategies:
“Last year Whole Foods partnered with the location-based marketing firm Thinknear to improve post-click conversion rates for its mobile ads, while wooing potential customers away from it competitors. The supermarket chain tapped into Thinknear to place geofences around a number of Whole Foods store locations and targeted ads and special offers to mobile users who passed by. Whole Foods also employed geo-conquesting tools (by placing geofences near competitors’ stores) to target ads at shoppers near competing grocery stores, thus incentivizing them to travel a bit further in exchange for better deals at Whole Foods. The campaign yielded Whole Foods a 4.69% post-click conversion rate – more than three times the national average of 1.43%.
Research identified three distinct features of MLBA. These are customisation, permission and intrusiveness.
Such features have been found to influence customers attitudes and purchase intentions, particularly at point of purchase (POP).
Customisation allows for tailored messages to the individual consumer. The affordance of being able to know your customers location enhances the level of personalisation, however its perceived effect on intrusiveness may create negative consumer attitudes towards the marketing messages being received.
This is where permission comes in, as consumers who have opted-in to receive such information from a brand will experience fewer cognitions about its level of intrusiveness.
This places implications on marketers, as it becomes a strategic imperative to balance these features.
Customisation allows for greater need fulfilment, which fosters positive attitudes towards messages and increased purchase intention.
On the contrary, high perceived level of intrusiveness can foster negative attitudes of company’s image which may lead to the rejection of marketing messages and decreased purchase intention.
From a marketing students’ perspective, I think MLBA strategies are innovative and have significant potential to drive positive results, however as a consumer it does scare me that brands can get into my phone to identify my location and send corresponding marketing messages to persuade me.
I am keen to know your opinion. Do you perceive location-based mobile marketing messages to be a great thing due to personalisation opportunities or do you think it is an invasion of privacy?