Location-based mobile marketing promises the sky: high conversion rates, surgical targeting, and rich consumer profiles.

But does it deliver? According to many accounts, it does.

Not surprisingly, retailers, brands, and agencies are scrambling to hone their location-based approaches.

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These encompass everything from "geo-aware" and "geo-fenced" ad campaigns, to hyper-local efforts keyed to Wi-Fi hotspots, and algorithmic location-based targeting of audience segments like soccer moms, bargain hunters, coffee enthusiasts, etc.

Location-based services offer solutions to two problems that have dogged mobile marketing: the scale problem and the tracking problem.

(Editor's note: For the duration of this report, we'll use LBS as our shorthand for all location-based services, including marketing applications.)

With the help of location data, marketers can identify mobile audience segments at a scale that makes reaching them worthwhile, and they can also target and re-target these audiences.

In this report, we'll review key stats on the LBS marketplace, explain how the most important techniques work, and take a look at the cornerstones to a successful location-based mobile strategy.

  • On the whole, LBS continues to outperform other mobile marketing and ad strategies. Not surprisingly, there has been a great deal of investment flowing into this space.
  • We'll review the differences between geo-aware, geo-fenced, and audience-based local-mobile ad campaigns.
  • The key to a successful LBS approach is in the data. We'll review the main sources of location data, and consider the advantages of in-house versus third-party data sources.
  • LBS has evolved far beyond smartphones and basic proximity marketing. Throughout this report, we'll look at the new frontiers for LBS, such as audience-building.
  • Finally, we'll suggest 6 LBS-dependent marketing tactics that have driven real results across different industries.


 

Click here for our previous January 2013 report on location-based services, "How Location Data Is Transforming The Entire Mobile Industry."

Click here for our most recent charts and coverage on location-based services.

Location Is The New Cookie

Before we begin, it's worth noting the unique place of LBS in the mobile industry.

LBS is not simply a mobile strategy, it's also a way of approaching mobile that has begun to solve one of the industry's most intractable problems: tracking.

The mobile audience has historically been the marketer’s white whale. From a marketer's perspective, mobile consumers have always seemed evasive, floating just beyond [...]