Agencies are known for having a wide cast of characters – we all know the stereotypes. You’ve got the creative diva, technical geek, suit-wearing account person, pontificating strategist, and so on. Each character brings strong opinions on just about everything from where to get the best coffee to the right solution for a client. When different point of views, strong beliefs and contrasting opinions meet, magic happens! In this specially curated series, we take you backstage to experience just that. Get your popcorn ready, because the fireworks are about to fly.
GEO-LOCATION TARGETING (targeting audiences based on the geographic location)
Nothing new or particularly exciting, but hugely impacted by the evolution of technology in the past few years. Furthermore, we can’t ignore the current disruption cause by COVID-19: each country is going through a different phase of recovery and most of the brands are still trying to figure out how to react and behave. As mentioned by Mark Ritson: “Predictions of fundamental change after COVID-19 are driven by the biased perspectives of those making them – in reality most things will go back to how they were”. While hoping that things will go back to (a new) normal soon, let’s explore the varying perspectives and key considerations through the lens of our specialists:
Nathaniel Yuen, performance manager of Wavemaker Hong Kong
Before jumping in on discussions about how this strategy would fit in the consumer journey or what kind of creatives would fit; let’s start with the most important question: is the technology ready for us executing this strategy right?
Where a person goes tell a lot about who he or she is. Consumers might have different wants in their minds or show different interests in their digital footprints; locations reflect the eventual choices they make for everyday lives.
When we talk about location technology, it is important to understand how brands can really take advantage of it. Certainly, brands whose goal is to drive footfalls to their storefronts are best fit for location-based marketing, but we have also seen increasing interest among brands even without physical retail presence. For any advertiser, what are the considerations behind adopting location-based strategy?
When it comes to location vendors, bid-stream data tends to be more scalable but plenty of data cleansing is needed. SDK data will provide higher accuracy and precision, but it is harder to get users to opt-in to their data being used. That’s also why we have seen location vendors with varying device penetrations in different markets.
To define what counts a footfall for a brand, they will need to set up the polygons of the targeted location. By factoring speed and dwell time, you can decide whether the device is transported on foot or by a vehicle, and whether people are spending time in your stores.
Apart from the latitude and longitude, there are some challenges over altitude - we might track footfall to the geo-fenced area, but the actual store could be on a different level inside a building or shopping mall. You can also leverage location data to profile users based on their past location patterns - who are regularly seen in your desired locations.
Even for brands without stores, it is excellent to target radius for wide spaces where visitors are more fluid. Examples will be targeting people attending an outdoors event or seeing an out-of-home placement.
Operationally, we need to talk about the trade-offs between accuracy and precision. For an apparel brand, they might prefer scale on all visitors including window shoppers passing by the stores. For a restaurant, they could be stricter on accuracy to only target and track people sitting down and dining in.
Location data is only as good as it can be effectively applied to our media planning and buying. We should leverage location vendors based on their capabilities to integrate with DSPs and ad servers, data targeting offerings, attribution measurement, and raw data provision. All these tech-stack-related questions should be factored when choosing the right location partner.
All in all, I feel location technology presents an excellent opportunity to understand behaviour, target consumers, and measure results. From an agency perspective, it is becoming an integral element in media planning that we should not overlook.
Final assessment: Technology and data are there. But first, think about your objectives and your strategy.
Marlot van der Stoel, director of Wavemaker Hong Kong
Wow... so many tech buzzwords, Nathaniel. Personally, I’d rather focus on the opportunities and leave things like accuracy to you tech-experts.
I strongly believe that when a consumer is already somewhat close to a specific location and is caught by an extremely relevant ad, he or she will put effort in finding the store. Therefore, our focus should be on relevancy and delivering value to the consumer.
For geo-location targeting campaigns to be as relevant as possible, they need to have their own creative and communication strategy. You cannot reuse existing assets and simply add this targeting option. If a client does not have the right assets to do this, then it will be better to stop here (and trust me, we will tell our clients).
At the same time, we need to make sure additional measurements are in place to proof value of the campaign. The investment in specific assets and the extra costs of this tactic should not outweigh the benefits to the business outcomes. We should make sure we can attribute results to our campaigns, or preferably, to specific targeting strategies, to determine if we have proof for the campaign being of value. At the same time, we can use these findings to manage our client’s expectations. This specific tactic is not going to make consumers line up in front of stores or single handedly lead to products flying off the shelves.
Finally, we should not forget to offer our consumers something of value to make up for our interruption. In an ideal world, this tactic is combined with a promotion that is relevant for them, not only because they are around the store, but also because of the person they are. Store personnel should be aware of ongoing campaigns and react effectively (no ‘where did you get this coupon?’).
As I said; I see many opportunities and not only for agency’s (for who adding geo-location strategies to the media plan can be an easy way to demonstrate some innovative skills), but even more for our clients and their consumers: Who would not love the idea of your consumers receiving a personalised reminder at the moment they are just 50 meters away from your store, giving them the last nudge to go in and buy their beloved products?
Or let’s turn it around and make it even more interesting by working on a ‘reverse’ geo-location targeting strategy. The idea of consumers receiving a personalised message as they approach the store that their favourite product is out of stock, or that the store currently has long checkout lines. Talk about serving the consumers’ needs first!
Final assessment: Go for it!!! But do not lose sight of the value you are meant to deliver to consumers.
Diego Cerrone, head of strategy of Wavemaker Hong Kong
I won’t spend time talking about the advantages galore, both Nathaniel and Marlot have done it enough, maybe too much!
They perfectly represent the youngsters in our industry: they seem to be more interested in talking about cool technology or getting a good client satisfaction score.
I am going to wear my ‘pontificating strategist’ hat and bring the discussion back to reality by focusing on what the marketing discipline can teach in this instance.
We shouldn’t ignore Ehremberg’s and Sharp’s lessons: marketing is a numbers game. Effective campaigns must reach lots of people and many are not actively searching for a product right now. There are 2 main tasks for any marketing campaign: brand building (making sure our brand is well known and comes easily to mind) and sales activation (exploiting mental availability and generating sales now). Understanding which channel is better for each task is key.
For brand building we aim for broad-reach media. We want to talk to everyone who might buy the category (in the next few years). For activation, we use targeted media (e.g. geo-targeted ads) to intercept people who are buying in the category now/very soon. Therefore, we must be information-rich, tightly targeted and responsive. Don’t waste time entertaining or seducing: if someone is already on their way to buy your product, why risk distracting them with something they already know/don’t need? Offering a discount to someone on their way to make a purchase is often like trying to sell a cape to Superman. Even without it, he is still going to fly!
Not surprisingly, digital channels work best for activation and it’s now easier to prove their ROI. But ROI can be a dangerous metric: it has an inverse relationship with long term profitability and should never be our sole focus. Unfortunately, some people in our industry talk as if profit and ROI were synonyms.
Effectiveness is about doing the right task and achieving goals. Efficiency is a measure of the effort needed to meet them. To understand the difference, think about diminishing returns: as you invest more on advertising, it often gets more effective (sales and profits generated go up), but less efficient (ROI goes down). What does it mean? The highest ROIs tend to come from small budgets.
Talking about geo-location, if we target too narrowly, it may be efficient, but it’s rarely effective. Frequently, tight targeting means low sales (and limited profit). Are we sure that the benefits of targeting outweigh the costs? Highly targeted media can be expensive and, at CPM level, geo-targeted ads, deliver tiny levels of reach at higher costs.
Trialing new/cool stuff is great and what makes our industry so exciting, but let’s not forget our true objective: growth. You cannot solely focus on short-term activities. If you want to drive long term growth, brand building is more effective. Experiment with new media on a small scale but be attentive to your big media investments – get these right because they are the ones that will maximise profit.
Final assessment: Always have a strategy in place first! Then choose geo-targeting because it is the best thing to do and not just because everyone else is doing it....