3 Insights on Location-based Advertising

Advertising messages have always been sent through one or more channels. With the advent of new technologies there secretly is hope for new and better ways to reach specific target audiences. One of those developments is the rapid spread of GPS enabled smartphones and the growth of location-based services (LBS) that allow marketers for disseminate commercial offers just at the right place (and further, at the right time, in the right context, etc.).

 In the first half of 2011, I conducted some qualitative research on location-based advertising for my master’s thesis. I want to share some of the results that are by no means representative (out of 73 participants only 16 were actually using LBS), nevertheless they are to some extend interesting. I spare you the theoretical details and framework the research was based on, but I am happy to provide you with the complete thesis (written in German) upon request.

The Reasons Why

The main reasons to use location-based services were to stay in touch with friends and acquaintances, followed by receiving information on your surroundings. Respondents admittedly started using LBS because their friends were using them too. The answers indicate that LBS are partly also used in order to create a favourable picture of ourselves that is presentable to our peer group. Thus, it is no big surprise that LBS are not used at places that are deemed inappropriate or embarrassing. Neither LBS are used at places that are considered private.

Attitues Towards Advertising

Only three respondents mentioned the chance to receive relevant advertising messages as a motive to use LBS, but everybody had an opinion on commercial offers sent via LBS. They have to be personalised and specifically tailored to wishes, needs, and the context. Furthermore, they have to offer additional value, maybe have an exclusive character, while at the same time they have to respect users’ privacy and should never be intrusive.

As particularly intrusive respondents described offers that are irrelevant, uninteresting, not targeted, and repetitive. Further the ads should never interrupt the actually planned “user experience” nor slow down the performance of the service.

Benefit of Location-based Advertising

The biggest advantage of location-based advertising is seen in the immediate chance of interaction. Between learning about an offer and buying it there should never be more than a few literal steps. This is maybe one of the great chances LBS offer to marketers: the conversion of online interaction into offline action. On the other hand it calls for a more real-time approach towards advertising, since every message sent has still to be valid the moment it is received.


What is your opinion or experience with LBS and location-based advertising?



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