$142.5B 2015 U.S. ad spending for 200 LNA
In the early 1990s, I toured Arthur Andersen's "Smart Store 2000," and it looked a lot like the retail experience marketers are envisioning now, loaded with location-based marketing systems akin to Apple's iBeacon technology.
An R&D wonder mocked-up just outside of Chicago, this "store of the future" was the place marketers and manufacturers, product folks and executives in the industry could check out all the latest inventions, dream about the future of product consumption, and visualize their company's place in it. As you walked down the aisles, the "store" would know where you were and would automatically promote relevant products to you. New-age computer registers would capture the name, age, gender, race and other demographic information of every customer.
The mad rush to location-based micro-marketing technologies has only picked up speed since then. Companies now try to predict what you want before you want it, as seen by Google's auto-fill features and recent news that Amazon plans to ship products to locations near customers -- based on previous shopping history -- before they even order them. Recommendation engines are everywhere, and marketers are scrambling to geo-target ads to consumers.
On its face, location-based marketing makes sense -- it makes offers more local and more relevant. And there is merit there. But when we have app services that seemingly have nothing to do with location (i.e. photo-sharing or game apps) asking for permission to use our location, things have gone too far. Why should I share my location with you, really?
The promise of the new "location-enabled commerce engines" is offset by a few realities. First, people are still primarily living within a set of habits and traveling within proximity of their homes. Sure, we're mobile and technically we're ripe for better experiences and offers, but we're also creatures of habit, frequently traveling through a predictable set of location points to pick up products we need. So for brands and marketers wanting a piece of our wallet, location is a small possible benefit unless the consumer can get something really worth it. Delivering geo-targeted ads that consumers are .002% more likely to click on? Not so much.
If we have changed habits, it's mostly to add convenience, and so we shop nationally and we do so online. This has nothing to do with giving permission for using location; it has everything to do with not wanting to leave the house or the inability to sneak away from the office.
Marketers are allocating a lot of resources to support locational accuracy. But ultimately, in a world where mobile is the new local, aren't timing, relevant offers and customer service more important? I think so. And just as the Smart Store 2000 was a magical experience that illustrated what was possible in the future of consumer experiences, it was also a lesson that the hardest part of marketing isn't coming up with new ways to change the consumer experiences -- it's coming up with new and practical ways to make it better.