On the hunt for the holy grail of mobile marketing

Thanks to beacon technology, passers-by at the Glattzentrum are sent a voucher from the Guess brand: the sun is blazing and it's over 30 degrees. Hundreds of people are gathered in a large square, sweating and thirsty. Suddenly, every smartphone within a radius of fifty meters vibrates. The news: everything at the nearby ice cream stand will be 20 percent cheaper for the next half hour. Naturally, the overheated people immediately flock to the stand and buy themselves an ice cream - and the ice cream vendor makes a huge turnover.What sounds like a marketer's pipe dream is theoretically already possible today. The magic word is "location-based marketing". Information is delivered to potential customers via mobile devices depending on their location. The user's location can be determined either manually or using technical measurement methods (see box).Advertising becomes more relevant and more interesting for the customerThe advantages of location-based marketing are obvious. Personalized messages in connection with the current location make advertising more relevant and therefore more interesting for the customer. The message arrives in "real time" and therefore at a time that makes sense for the customer, such as when shopping in the afternoon or going out in the evening.The possible applications of location-based marketing are diverse. Potential customers can be approached in or in front of a store. Companies can also draw attention to their own, better offer nearby or on the Internet in competitor stores, while service companies such as hotels can offer their guests additional services depending on the time and location in relation to their arrival. Visitors to events can also be made aware of specific goods or services on offer.Swiss companies are reluctant to useHowever, location-based marketing is still rarely used in Switzerland. At the beginning of 2016, the Lucerne University of Applied Sciences and Arts and the University of St. Gallen surveyed 129 Swiss companies about the importance of various mobile tools. Only 20 percent stated that they use location-based marketing outdoors. Nine percent are planning to use them, while 35 percent are discussing their use. 36 percent stated that no use is planned (see chart).why this hesitation? On the one hand, it is due to the complexity of the topic. In a survey of digital marketing managers in the UK, 40 percent cited a lack of experience as the main reason why location-based marketing is not used.

Only 20 percent of Swiss companies currently use location-based marketing. Use is planned for 9 percent. Source: Company survey on mobile marketing, Lucerne University of Applied Sciences and Arts & HSG.Data protection and lack of strategies as hurdlesData protection issues also arise in connection with location-based marketing. Either the user's consent is required or the advertiser does not use personal location data. In either case, the user must be able to opt-in or opt-out, and most companies do not yet have a strategy in place to create, manage and share location-based insights, as it is also difficult to measure the success of location-based marketing. Key figures such as "store visits" or "increase in store visits" are rarely recorded. In the USA, on the other hand, some providers already use the "cost per visit" billing system, where companies only pay if actual visits to a store can be verified by independent measurement."Technology must be precisely scalable and measurable"The company "xAd" is a global leader in the field of location intelligence and uses a specially developed Blueprints technology to digitally capture real locations. "Blueprints" automatically draws outlines around millions of buildings and other locations. "For location-based marketing to work, the technology used must be very accurate, scalable and measurable," says Johannes Paysen, Country Manager at xAd. "Campaigns that take into account the actual local context of the recipient have the greatest potential. "So instead of playing out a desktop campaign broadly to users in a general radius around a shopping area, advertisers should include the detailed information that only location data can provide. "Delivering a specific message to users in the right context can achieve very good results," says Paysen.McDonald's relies on location-based advertisingTogether with McDonald's and Omnicom, xAd recently implemented a campaign in which three target groups were addressed with different messages. Different ads were played out depending on proximity to a restaurant, competitor or movie theater, etc. Special offers and interactive signposts to the nearest restaurant were very well received by the target groups. The result was 1.3 million restaurant visits, with 30 percent of consumers visiting a McDonald's branch within an hour of being exposed to the campaign. The companies involved were recently awarded the German Media Prize for these results.Beacon pilot project at Glattzentrum WallisellenThere are only a few flagship campaigns in Switzerland so far. In April 2016, Swisscom carried out a "beacon pilot project" together with the outdoor advertising company APG|SGA and the loyalty app Poinz. For this project, 23 APG|SGA billboards in and around the Glattzentrum in Wallisellen, which displayed a Guess campaign motif and drew attention to the project, were equipped with a beacon. The "Interact platform" launched by Swisscom in 2015 formed the technical basis for this application, enabling passers-by to automatically receive targeted cash vouchers for Guess when they were in the vicinity of a poster using the activated Poinz loyalty app. However, the prerequisite for this was that the user actively allowed the Poinz app to access their location in advance.Great potential, but also major challengesThis test campaign shows how many hurdles there are to overcome with location-based marketing. The "holy grail" of mobile marketing - addressing target groups with the right content in the right place at exactly the right time - is anything but easy to achieve, but the potential of location-based marketing is huge. It is therefore only a matter of time before more and more Swiss companies turn to this marketing method.