Location targeting pays off

Warc, 11 February 2013

NEW YORK: Mobile campaigns that utilise location targeting are twice as effective as other strategies, according to a new report.

Verve Mobile, a specialist in location powered mobile advertising, analysed more than 2,500 campaigns delivered on its mobile platform during 2012 and found that the click-through rate (CTR) for all location-based strategies was greater than the industry average of 0.4%.

Geo-aware campaigns, using real-time location data, scored highest with an average 1% CTR, followed by geo-fencing, where advertisers target users based on a set distance from a location of interest, on 0.9%.

"The big news is that location powered mobile advertising outperforms other mobile targeting strategies by 2X," Tom MacIsaac, CEO of Verve Mobile, told Mobile Marketer.

"Not only is location a must-have but it is really the key value mobile brings to the table for marketers – location targeting is the ability to reach consumers on their uniquely personal devices while they are out and about, on the go, and closer to the buying decision than ever before," he said.

The report established that during 2012 the most widely used tactic, accounting for 30% of location-based campaigns, was based on a designated market area.

This was followed by the use of third party data and place-based targeting, on 24%, and geo-fencing on 22%.

A total of 14% of campaigns were geo-aware, while just 6% were targeted based on ZIP code and 4% based on city.

The report highlighted the recent upsurge in interest in such marketing, as the proportion of location-based campaigns across the Verve network more than doubled in 2012 to 36%.

Retailers and restaurants are in the forefront of this trend as they seek to drive footfall. Consumer goods companies have also been successful in directing mobile users to the nearest grocery or retail location where their products are sold.

One such was Central Market, a high-end Texas grocer, which achieved a 4.1% CTR with a geo-aware campaign that put "user distance to store from location x" into the creative being used to raise awareness of special products being promoted through in-store events.

Data sourced from Verve Mobile/Mobile Marketer; additional content by Warc staff