Marketing Goes Local
Release date: October 12, 2012
Host: Vanessa Iarocci
Guests: Aurelie Olives, David Peres
Running time: 13:45 minutes
Digital and mobile delivery platforms are allowing businesses greater than ever access to their consumers. PwC’s Aurelie Olives and David Peres, Chief Marketing Officer, ADCentricity Inc. discuss this new trend and how businesses can fully utilize it.
Voiceover: Welcome to Strategy Talks, the business podcast series from PwC Canada. This interview series featuring new topics and guests every episode is designed to give you valuable insight into some of today’s hottest issues affecting your business.
Vanessa: The shift to digital has revolutionized the advertising and marketing sector so quickly that organizations are still grappling with how to incorporate digital vehicles. Yet digital and mobile delivery platforms can enable brands to deliver messages and engage with their consumers at a level of intimacy never achievable before.
With me today to discuss the challenges and opportunities provided by location based marketing, or LBM, is Aurelie Olives, a manager with PwC’s Consulting practice and David Peres, Chief Marketing Officer of ADCentricity. Welcome.
To start off our conversation, perhaps you can just shed some light on what location based marketing, or LBM, actually is.
Aurelie: Location based marketing covers the integration of all media to engage and market to people in specific places with specific messages and offerings. Location based marketing uses location based services to reach and engage with consumers based upon where they are located. It’s not just about mobile, location based marketing leverages different delivery mechanisms such as out-of-home, social media, Internet, real life interaction and also print and TV.
We are moving to a world where every person, place and thing will be real time geo addressable or tagged unless individuals specifically opt out, even temporarily. This world enables us to create both one to one and one to many marketing messages.
The notion of opt-in is very critical in the concept of location based marketing to the relevance and the effectiveness of that service. Encouraging and possibly incenting consumers to obtain to location based marketing services will enable marketers to collect information about individual consumers such as their demographic information, their preferences, their purchase habits, but also deliver more relevant value-add messages and offers to them.
Vanessa: So it’s really a game changer for marketing. David, what’s your take on LBM?
David: The point where connection engagement gets closer to transactions, it’s the merging of the physical world with the digital world. It’s the real-time interaction everywhere. Location really provides the context for the consumer, it generally makes them more receptive to brand messages and information. It’s really an opportunity for marketers to deepen the experience within the context of where they are at any point in time. For example, while I’m in the service department of my car dealer, I’m much more willing to receive messaging and information about tires, tune-ups and new models of cars being featured in the showroom. Or while I’m in the grocery store, I’m open to hearing about new products and quick meal solutions.
Vanessa: That’s really interesting. So if you have a mobile device and you’re in a car dealer, you can get that message in real time about your specific experience in that moment?
David: Yes if you’ve opted in and you’re receptive to receiving the messaging from the car dealership, you can get the messaging at that moment in time.
Vanessa: What sectors do you think are going to benefit the most from LBM?
David: The sectors that will benefit the most are the large brick and mortar locations. Location based marketing can really help drive incremental traffic by reaching active shoppers while they’re out shopping. I’m more receptive while I’m out shopping and spending money so it can really help drive the impulse purchases , it can make consumers aware of deals and specials while they’re standing in a specific location.
Vanessa: Aurelie, are there any other benefits?
Aurelie: To David’s points, retailers and large brands are greatly benefitting from location based marketing services but actually this service impacts all segments of the marketing eco system and creates opportunities for existing stakeholders like brands and retailers but also for mobile network operators, handset manufacturers and payment companies. For example, some of the key considerations that the telecomm providers may ask themselves are how to leverage their large customer base and network assets to position themselves on the mobile marketing space? And also they can ask themselves who should they partner with to maximize their services and add value to their consumers.
Another great group that benefits from that service is of course, the consumers who are able now to receive relevant messages and offers such as coupons and discounts, upgrades, fast track status, they can identify what is the faster cash line up at the grocery store, for example. Consumers are able to access those services that they would not otherwise, should they choose to opt-in into those services.
David: It’s really an opportunity to increase loyalty too by strategically incentivizing customers based on past behaviour. And when they’re in close proximity to their favourite retailer, location based marketing can really deepen the brand experience and create lasting brand impressions by providing contextual information of offers while the consumer is most receptive to the messaging.
Vanessa: So, now, David I have to ask, is the consumer actually receptive, how does the consumer actually feel about this?
David: It’s all done on an opt-in basis and opt-in is very, very important in this area so, we don’t want to be annoying consumers on their mobile devices because that’s their most personal, intimate device that they have. So, it’s purely opt-in and a value exchange for them.
Vanessa: Okay, so consumer has to opt-in and when they do that they can receive advertising through this new channel. Now, how does this impact traditional channels and how do you go about integrating LBM into your corporate strategy?
Aurelie: Integrating location based marketing is really an enterprise solution that should be part of companies digital marketing and operations strategy. There is often a direct connection between location based marketing and mobile marketing and this connection often limits investment in experimentation and testing opportunities for those initiatives which those experimentations and testing opportunities are critical to keep up with the fast changing marketing landscape and figure out what works and what doesn’t work. Brands need to think about where their location based marketing budgets should come from and think about investment in capabilities and infrastructure to analyze and use the information that is being captured about their consumers’ behaviours and purchasing habits through those channels as you said.
Vanessa: David did you have anything to add about how LBM impacts traditional marketing channels?
David: Yes, LBM is really an extension of the integrated marketing plan. It really provides the opportunity to localize a national campaign and engage consumers while they’re in close proximity and close to consuming your brand. Done properly, location based marketing will augment your national efforts and connect your brand with consumers at the point of sale.
Vanessa: Interesting, so, if you look at a marketing strategy, is this a net new spend or are we talking about allocating away from the more traditional tactics like print and TV, for example?
David: It is going to be a part of the overall marketing budget. What our job is to do now is to really educate planners, buyers, agencies and brands that this is a new emerging space in marketing and that they should be allocating money to this powerful opportunity to influence consumers.
Vanessa: Any first blush results from these types of marketing strategies in your experience?
David: Yes, there’s some really interesting examples out there and people are highly experimental in this area and the brands that are going to win are the ones that are willing to take the risk and to make some inroads. We’ve seen some really interesting things where you’re using the location base to connect the physical world with the digital world. For example, a pet food company decided that the best opportunity to sample pet owners was while they were out walking their dog so they created a billboard that was interactive so that when you came up to the billboard, you actually checked in using your mobile device on FourSquare. So it knew your location, it knew where you were and it dispensed a sample of dog food that your dog could eat out of a bowl that was at dog height on the billboard. And then, the person that opted in was also given a coupon to go and repurchase that pet food while they were in their stores.
Also, Mini did an interesting one too where they suspended a Mini on a rope and they had a Bunsen burner below the rope and every time someone liked Mini on Facebook, the Bunsen burner would flame up and take a little piece of the rope away and the last person that liked Mini on Facebook and cut the rope won the Mini.
Vanessa: Oh, that’s all really, really interesting. So lots of exciting things happening. Now beyond marketing channels, what are the key considerations to address when incorporating this type of new strategy?
David: Research departments, digital and the IT group have to have a willingness to embrace this new technology and the real time nature of the brand engagement and be willing to measure and track and utilize all the results.
Aurelie: Some of the key considerations when incorporating location based marketing in an organization are different based on who those companies are. So for example, for brands and retailers, data analytics is key to be able to harness the huge amount of the data points captured about consumers. For example, the level of detail that can be captured is the footprint traffic in a store so where a given consumer moves from point A to point B within the store. Also collaboration is very critical for brands and retailers to understand who they should partner with and how to best get a higher return on investment on their marketing dollars.
In some cases retailers need to invest in WiFi technologies for example, that is quite capital intensive. Experimentation also, for retailers and brands is critical. There’s been a number of experimentation that David’s company has run so maybe you can give some of the highlights of some of them.
David: Yes, thanks Aurelie. We did one using our ad mobile platform. We launched a real-life pilot with a major Canadian retailer and achieved some interesting results and what our objective was was to increase the basket size at this particular retail location. So using point of sale material, we had consumers opt-in to the ad mobile platform, we intercepted about 1500 consumers and we had approximately a 50% sign up of those that were made aware of the opportunity to receive additional offers while they were in the store. We offered a very modest 10% off when consumers spent above a certain price point and we had redemption in the 46% range of those who had received the message.
Vanessa: That’s incredible. Fabulous stuff. So, do you find yourself increasingly working on mandates like that with your firm?
David: Yes, ad mobile is one of our platforms. ADCentricity is really a location based digital media company that offers marketing solutions that drive sharper engagement depending on the person’s physical location. So we have our two platforms, we have our ad mobile which we just spoke about in the example which engages consumers, it’s a mobile shopping platform that distributes offers based on location and proximity plus has some really cool shopping tools like analytics, car find; you can tag your car in the parking lot and remember where it is when you leave the shopping centre.
And then ad central is a platform that distributes and delivers messaging to digital signage and digital screens based on a consumer’s location as well.
Vanessa: Great. Well, thanks David and Aurelie. I’ll be looking forward to lots of interesting advertising on my new mobile device.
Vanessa: For more information, or to download PwC’s Marketing Goes Local report, please visit www.pwc.com/ca/mgl
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