Location Based Services and Agencies

Now that the Awards are over, at least for a few months,  I’m hoping to have a little more time for blogging.

I have been talking to a number of agencies over the last 3-4 years about LBS. I don’t know whether it was me or that the bright lights in this agency space seem to all go offshore, often within the same company before we get to do anything together. Companies like The Hyperfactory have been doing some cool things on the edge of LBS, but it seems that all their cool stories these days are also overseas. It was great to see them enter the awards this year, though and they have a Finalist Award to add to their trophy room which must be bursting at the seams.

The types of LBS applications are very wide and we could have had many more categories in the awards. The thing is that location is simply what it sounds like. It is about where you are and what you are doing wherever you are. It could be about having a pizza delivered to you on the beach, or about catching the bus to Get Somewhere. It could be about going on a treasure hunt or finding a bar or cafe nearby afterwards. Location is ubiquitous, just as your mobile phone is. You are always somewhere. If your phone knows where you are, then it can help you find things, places and people. It can help you be entertained, help you with your sport or hobby, provide you with localised information, the list is infinite.

So back to Agencies. LBS adds another vehicle to incorporate into Marketing and Advertising Campaigns. It gives them the opportunity to come up with fun and compelling ways for brands to interact with consumers and other customers at the time and place that has the most relevance. Traditional forms of advertising are very often scattergun and rely on high levels of repetition to realise a call to action. Traditional Direct Marketing (DM) considers 5-7% response to be a good result. In my book that says that over 90% of the DM spend is wasted. Why is that? Because most people are not open to buy or looking for their products at the time they are ‘exposed’ to the promotion. In addition to that, most people are smart enough to look for what they want, when they want it. They will then either check out their favourite stores or use Google to find the products they want.

The other huge resource that people use is Word of Mouth Marketing, which these days means talking to people close to them, or just as likely today, to use Social Networking sites to ask the opinion of their ‘friends’.

So what can agencies do? They can come up with campaigns or solutions that are relevant to people’s interests at the time and place that is relevant to them. The time and place to tell someone about the great new winter fashion that is in their favourite clothing store, is when they are entering the mall. The time to tell people about the new Stephen King book is when they are near the bookshop.I’m going to talk a lot more about these concepts in the coming days and weeks, so why not subscribe to this blog with your favourite RSS aggregation app  like iGoogle.Just to put things straight, LBS is not something that will replace other forms of marketing, it will augment the campaigns, reinforcing the messages and making them relevant and encourage an immediate call to action. It is an enabler and a tool that will help brands fine tune their target marketing and improve its effectiveness.

I will also explain in future blogs how the tools and data that GeoSmart Maps has, can facilitate the creation of the applications or features of LBS from a laymans persepctive. I’m not a developer, but what I do understand very well is what each tool does and how it can be implemented to achieve the results you want. So if you want to know more, watch this space, bookmark it or get yourself an RSS Reader.

Also, do feel free to comment or ask questions.

Proximity Based Marketing and the Location Innovation Awards

So what’s the big deal with Proximity Based Marketing? We have included this category in the Awards because it offers a huge opportunity for companies to engage with potential clients in a way that adds value to them. There are different ways of doing proximity marketing, our interest is specifically mobile and opt-in. That means that you only participate in a campaign if you chose to and in doing so there are some critical criteria. I will explain those, but first let’s get an idea of what the concept means, because a lot of people don’t really understand the concept.

Proximity based marketing is about getting messages, offers, invitations and communication about goods, services, activities based on where you are, i.e. they are availble close to where you happen to be. There are two main methods for doing this from a mobile persepctive, which is our interest in this competition. One is around targetted SMS messages, being the easiest technology to use currently and the other is Bluetooth. Unless there is an opt in component, Bluetooth is unlikely to be supported in this environment, but it could be. Bluetooth is really about short range communication between devices, say up to about 10 metres. It is a short range radio frequency concept that normally requires ‘pairing’ that is both devices agreeing that the other device is a trusted device to communicate with. So in most cases you can not communicate with another Bluetooth device unless A/ It is switched on (using a fair amount of battery power); and B/ It is open to communication with other devices in ‘Discoverable Mode‘ ; and C/ It has registered the other device as one it will communicate with. This is how you can have a Bluetooth headset for your phone and not listen in to calls that other people in the vicinity are making who are also using a Bluetooth headset. Free and open communications are not receommended because of the risk of virus attack.

So the concept, which according to BlueTomorrow is ‘all the rage’ of Bluetooth Proximity Marketing means that you have no control over who sends you messages. You may think that’s a good thing, but the last thing I want as I walk past shops in the mall is to receive unsolicited messages asking me if I would like information or perhaps  an electronic coupon for products which are in the store. If they have deals, let them put some good material in the shop window.

Another concept which also isn’t in the scope of the competition is applications that require you to do something based on a billboard or other Point of Sale. In effect they didn’t contact you, but they persuaded you to do something when you happened to be somewhere. An excellent example is the UN Voices project put together by The Hyperfactory, who are a worldwide expert company in wireless and mobile marketing in Australia. The concept was that you take a digital photo of a mouth on a billboard and then get sent an audio message of the person who’s photo you took, telling you about their lives. This and other great examples of their work which are very inspiring can be seen here.

So the concept we are talking about goes like this. Through a form of marketiong, you convince people to opt in to a service, it could be via a brochure, a message on product packaging or on a label, or perhaps through a website or billboard. You will allow the service to send you messages based on your interests in products or services, which will probably be SMS or Text Messages. The messages might contain an offer, an electronic coupon, or ask you to do something.

To me the concept of being offered special deals for things that I am specifically interested in at a time that I would like to receive it is a great idea. For the marketing company if they can find willing subjects it is also great because it is targetted rather than the normal scattergun approaches. How much junk mail have you received in the recent build up to Christmas sales mostly about things you weren’t interested in? What would be the ad drop to sales conversion ratio. A very good DM (Direct Marketing) Campaign would get 5-10% return, the average would probably be less than 4%. If you know you can target people that are interested, you would get a significantly greater result.

The thing is, you don’t want SPAM solicited or not, so there need to be rules and if the rules aren’t followed, the entire industry could be set back for many years. So for the competition our rules are:

1. You must clearly understand what you are opting into.How many messages are you likely to receive.

2. You need to have control over when you will receive messages. For example for a ‘Happy Hour Club’ You might decide you only want to receive messages on Friday and Saturday nights and only between 6 and 10 PM.

3. From a proximity perspective you may only want to receive offers when you are within a km of a participating bar or club.

4. It needs to be easy and clear how to opt out. People might try something once in a while, but there are many services such as subscription newsletters where it is very difficult to figure out how to opt out of the service.

It’s interesting when you start searching for existing applications, how few actually exist so far, while the web is full of sites suggesting what could be done, most of the companies who could be doing it aren’t and wouldn’t know where to start, which is why this competition is so important. So here are a few ideas:

• BP Petrol stations in New Zealand sell coupon books which give you two-for-one deals on coffee. The sell car wash services with coupon books so that your 5th car wash is free. You have to go out of your way to get them and most of the time when you need them they are not around. They generally do not work very well in motivating people to use the service. Often there are competing gas stations accross the road and people have a choice where they go. At commuting times of day most traffic is driving one one side of the road, the gas station on the other side misses out. Why not add a service for people to opt into so that they can be offered special deals when they are in proximity of petrol stations at quiet times. It could be a free coffee with $60 worth of petrol, it could be a half price carwash etc. I don’t know too much about the petrol industry but people sure like a deal. Why not give them one when they are close by. Why not get them to top up their gas now, when they are near your business, especially if they weren’t planning to stop.
• Imagine you have signed up for your favourite retail clothing chain, given them your favourite colours, style and size. They know when you are walking into the mall, either because your phone has told them, or because you texted the name of the mall to the short code on the sign at the entrance. Now you get a text message saying that they have got something similar to what you loved last summer and if you come in now, you will get a 2nd garment for half price and you can forward this to 3 friends who will get the same deal.
• Still in the mall, you walk past the Music Store who send you a message saying that your favourite band’s new album has just been released and another group who is quite similar also have a great new album and if you come in and buy them both now, you will also get a free collector T-Shirt.
• How about renting a camervan or motorhome and subscribing to travel deals as you drive on your holiday. As you travel around the country, you get SMS alerts from attractions and activities within say 10km of your location. You drive into Waitomo to go on the boat trip the the underwater caves, but the day has been quiet for the Black Water Rafting Trip so they send you a special deal where the 2nd person goes for free. As you drive further towards the end of the day and are thinking about where to stay, you get a text message from the nearby Top 10 Holiday Park with an offer of a 20% disccount on your meal at the restaurant next door.

The key to this concept is that the offers are targetted and the recipient has control of when, how often and what type of deals they are offered and have the ability to stop them as quickly as sending a text message. You might subscribe indefinitely or just for the 5 day trip in your motorhome. In many cases these deals might also include aspects of other categories such as LBS Games or Social Networking. The key is that it targets you because you are interested in or a regular consumer of the goods and services, buit most importantly because you receive the deals when you are in the proximity of the offer, they are welcomed. You don’t want to receive an electronic coupon for a petrol discount if you are on the beach or out on the boat, you want it when you are driving past. You want something that is a really good deal.

Hopefully I have given you a few ideas for applications you might like to come up with for the competition. If you are not elligable or don’t want to participate, please feel free to share comments or ideas on this blog that other people might be able to pick up on.