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IAB’s Location Playbook: What Retailers Need To Know About Geo

With retail at the forefront of the use of geo-data and proximity marketing, the IAB is offering brands a sense of how to proceed.

As location technology becomes increasingly embedded in brands’ daily marketing activity as well as informing the creation and placement of cross-channel ad campaigns, the Interactive Advertising Bureau is releasing a guidebook designed to bring advertisers up-to-speed on the best practices.

The IAB’s Location-based Marketing Playbook for Retailers reflects several trends surrounding the use of geo-data for advertising and marketing. To start at the top, the smartphone has fundamentally upended the strategies for creating and using advertising and marketing.

In essence, digital industry professionals often compare location data to online tracking pixels by identifying the ability to gather consumers’ place history from their mobile activity as “the cookies of the physical world.”

The Competitive Retail Environment

The result of these changes is impacting spending: Location-targeted mobile ad sales are expected to rise from $9.8 billion in 2015 to $29.5 billion by the end of 2019, for a 24.6 percent compound annual growth rate, according to BIA/Kelsey. That shift in expenditures has captured the wider online marketing industry’s attention.

As for the particular focus on the retail segment, as opposed to other hot location categories like QSRs, autos, transportation, and hospitality, Adrienne Beck, director of Sales Strategy for IBM’s The Weather Company, pointed to retail’s specific needs and applications for location data.

“For retailers, [location] data is particularly valuable,” writes Beck in a blog post accompanying the IAB’s playbook. “At a time when the retail environment is increasingly competitive and consumer loyalty is at a premium, mobile location data can provide retailers with an advantage in the marketplace.”

Beck,  a member of the IAB Mobile Location Data Working Group that developed the new guidelines, adds that retailers “should also be confident in the return on that investment by including attribution such as lift in foot traffic in every initiative, but also by applying a critical eye to how that attribution is determined – from control to exposure, and first-party data vs panel-based models.”

A Call For Transparency

The IAB’s document was overseen by 17 member companies including xAd, Foursquare, PlaceIQ, Placed, Thinknear, Factual, Verve, Unacast, NinthDecimal, and Google.

The report also anticipated the current crop of attribution and analytics offerings meant to satisfy retailers’ greater demand for knowing whether or not their location-based marketing efforts are actually leading consumers to their stores. The demand is for greater transparency.

Over the past few weeks, for example, xAd and Retale have begun presenting respective versions of performance-based ad formats that provide a guarantee: marketers only have to pay for the ad when a consumer who’s seen it walks through their door.

“Retailers should ensure that their location solution providers are not only transparent with them regarding how solutions are built and executed, but that they are also open with consumers about how their information is collected and used,” Beck writes. “Not all location data is equal, nor are the potential location-based solutions. The location data that retailers rely on from partners needs to be both accurate and actionable.”

Powering Purchase Intent And Discovery

The IAB playbook comes a week after the Media Ratings Council, in collaboration with the IAB and Mobile Marketing Association, released its own best practices for measuring and initiating location-based marketing programs.

The IAB delves a bit deeper into use cases for location technology for driving and evaluating consumers’ purchase intent and discovery.

As we’ve noted previously, roughly 90 percent of purchases are made in a physical store. The role of mobile and the Internet of Things to drive shoppers’ decisions in micro-moments, along with the emergence of artificial intelligent search programs that provide direct answers via voice-activated digital assistants, will also have considerable influence on marketing and the “customer journey.”

In all those cases, location data is at the center of all the knowledge that leads consumers where is best to buy what they want — and it tells marketers how to respond in advance to those consumer decisions.

“For example, instead of only using internet browsing behavior to identify and prospect against ‘auto intenders,’ advertisers can now opt to identify these people based on how frequently they’re visiting show-rooms or auto-shows,” the IAB playbook notes. “Another concept along this same theme is to use the concept of ‘lapsed visits.’ For instance, if a regular consumer hasn’t visited a store for a certain amount of time, this would send a signal to the advertiser that it is time to reengage with that consumer.”

Smarter Search

As the IAB notes, citing the Google stat that nearly 1 in 3 mobile searches are related to location.

Search ads enhanced with locally relevant information makes it easier for shoppers to find the specific retailer that fits their particular needs.

Best practices for location-based search ads include displaying helpful information like directions to stores, and providing up-to-date address, store hours, and phone numbers so that prospective customers can reach out if they have questions about a particular product availability.

From there, location-powered search ads can also inform traditional ad methods from TV to out-of-home.

“Retail marketers now have the potential to see how much contribution an offline campaign makes to their online and offline sales by tying a device passing by, for example an Out-of-Home (OOH) campaign, with purchases on mobile devices or physical retail stores,” the IAB. “By connecting these channels through mobile location data, retail marketers are able to more effectively quantify ROI for their cross-media campaigns.”

Questions For Offline Measurement

Picking up from the MRC guidelines, the IAB playbook calls for a need to standardize online-to-offline foot traffic measurement. This is something on which the IAB says it is continuing to work on.

For now, the IAB recommends asking two key questions to providers of location insights and analytics:

  • Is device location data collected through panels or pass through ad exchanges?
  • When measuring store visit lift, what is the control group selection process?

“No in-store traffic measurement methodology exists that can take into account all visitors to a location, simply because there is no way to see location data on every person in the U.S.,” the IAB playbook acknowledges. “This means that there is never 100% location-based data coverage. The relative reach, scale, and precision may also vary from one location data partner to the next.”

The report is rounded out by discussions of augmented reality and beacons (they’re a good way to help customers evaluate products at the shelf-level), as well as ways of using location to provide greater personalization to “enhance the in-store experience.”

Ultimately, the IAB’s playbook is a comprehensive primer on where the industry is right now. As the role of voice-activated search and the rise of ideas like on-demand and shared mobility shape consumers’ shopping behaviors, the uses of location will expand rapidly — and the understanding of how to employ those techniques will need to constantly catch up.