Three significant digital technologies are converging in 2012 to redefine how you shop: social media, mobile, and big data. A holy trinity for marketers akin to the elusive unified field theory for physicists, the emergence of SoMoDat (as I like to call it) is forcing a wholesale reappraisal of business marketing strategies great and small.
As smartphone and tablet adoption continue to expand, the number of consumers using big-data driven location-based mobile services will proliferate. Greater usage means greater data collection, which in turn enables marketers to provide ever more hyper-targeted location-based mobile services.
Thus is born a virtuous-or hellish-cycle, depending on your perspective.
As eMarketer writes in a recent blog post on the topic, “success, however, will hinge on marketers providing a high degree of transparency regarding the use of personal data and delivering tangible rewards or relevant content that improves a customer’s shopping experience.”¹
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It’s hard to argue any of those points: transparency, relevance, user experience – three themes (or memes) that encapsulate the evolving inbound/Internet marketing industry.
According to our friends at Pew Research, location-based information services can either be GPS-enabled map services, or reviews of nearby attractions accessed through a mobile app or web browser. In February of 2012, the Pew Internet and American Life Project found that 74% of smartphone owners accessed such services.¹
For those (like me) who find significance in this statistic, here is a brief summary of three location-based services that, when taken together, provide a window into the emerging SoMoDat marketing movement.
DON’T FENCE ME IN
A“geofence” is a virtual perimeter that is established around any physical space, such as a bar or restaurant, a retail location, an airport, or a stadium, that sends text notifications on an opt-in basis to mobile devices within its sphere. Brick-and-Mortar establishments use geofencing to encourage customers into their stores and make an immediate purchase.²
Consumers who opt in receive texts when they are within range offering discounts and coupons that they wouldn’t otherwise find online.² Retailers can get hyper-local with these promotions, offering deals on goods and services to passers in an attempt to encourage impulse purchases.
Early experimentation with geo-fencing has produced mixed results for many brands. One the one hand, there is the “creep out” factor on the part of consumers, with some regarding such offers as an invasion of privacy. On the other hand, consumers are growing more accustomed to receiving text coupons, with more than 3.4 billion mobile coupons around the world redeemed in 2011.²
TAG, I’M IT!
As a natural extension of the geo-fencing concept, geosocial services such as Yelp have successfully merged social media with location-based servicing. Yelp is an online user-generated review site. Or, as they put it, an “online urban city guide that helps people find cool places to eat, shop, drink, relax and play.” With 78 million unique monthly users reading and posting reviews, Yelp is projecting 2012 revenues of $138 million, up 62% from 2011.³
Another trend in geosocial is something called location tagging. This is where smartphone users log-in to a social site and “tag” their current location along with other content.
According to data from mobile audience media company JiWire reported in a recent eMarketer post, over 60% of mobile Wi-Fi hotspot users in Q2 2012 tagged their social media status updates, photo uploads or other posts with their location.
The JiWire study also found that a whopping 88% of those surveyed used Facebook, with 88% of that group using location-tagged posts. More than 70% of Google+ users, 68% of Twitter users, and 60% of Instagram users did the same.
Privacy be damned.
Given this information, it’s no shocker that big data collector Facebook has been encouraging advertisers to experiment with location-based offers of late.
IT’S LIKE THEY KNOW ME
Speaking of big data, GigaOm reports that Cambridge, Mass based mobile analytics provider Localytics has just raised a boatload of cash ($5.5M) to launch a new automated mobile app marketing platform allowing developers to message customers and encourage them to take certain actions or make purchases. According to the company website, Localytics “integrates app marketing and app analytics to deliver automated and targeted messages based on app user behavior and engagement.”
Localytics’ service works by allowing developers to send out “in app” messages to consumers that are triggered by specific actions. For example, a developer could provide a user free shipping if they abandon a shopping cart.
By combining big data with geo-local messaging, developers can send the right message to the right person at just the right time, steering them into a specific action. Localytics can also tweak the messaging in real time to produce different results.
It doesn’t take a brain surgeon to see that sophisticated location-based services such as Localytics will seriously impact the future of SoMoDat. Throw in a sprig of geosocial location tagging, add a touch of geofencing, and you’ve got a potent brew sure to affect the purchase decision of many a hapless mobile consumer for years to come.
¹ eMarketer, “Geolocation Services Offer New Frontier to Marketers”
³ Search Engine Land, “Yelp Posts Q2 Revenue Gain, Claims 78 Million Users Globally”