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Data is key to the future of mobile check-ins

June 1, 2012

Mobile check-ins have been losing steam for a while. However, by offering an upfront value, as well as relevant and tailored content, marketers can drive that in-store traffic.

According to some mobile experts, consumers have moved beyond simply checking-in to receive a coupon or deal. Instead, consumers expect that when they check-in to a location, marketers will be using data about them in exchange for a relevant piece of content.

“Whether consumers like it or not, the devices they are using know exactly where they are and, using algorithms, can extrapolate certain behaviors,” said Wilson Kerr, vice president of business development and sales at Unbound Commerce, Boston.

“Someone who checks-in at work on Friday morning in San Francisco and then at a bar in Tahoe that evening might be someone receptive to receiving an ad for a vacation home rental in the mountains, for example,” he said.

“Also, while this data must remain depersonalized, the carriers and platform providers like Google and Apple know a huge amount about the hundreds of millions of nameless consumers who use their devices or operating platforms every day. Increasingly, this data is used to deliver ads that are disproportionately more likely to be acted upon based on consumer relevance factors like location, in real time.”

Location-specific data
Simply using GPS as the determinant if a consumer is interested in receiving an offer is not good enough for marketers today.

However, using data from their past behavior or social media can be a clue in how a consumer wants to be approached.

For example, companies such as location analytics platform Locately and other start-ups can help brands use data to understand how consumers shop in-store, which in turn can be used to target users with relevant deals and offers.

Marketers also need to be thinking about how to mine in-app data from users to find trends that can be used by brands and retailers.

By looking at data, brands can get a better grasp on what types of activities consumers are doing in-store such as how a company’s competitor stacks up in similar marketing efforts and foot traffic.

“Even a slight upward tweak in response rates based on the harnessing of real-time location data and behavioral patterning algorithms can add up to big bucks,” Mr. Kerr said.

Local growth
According to a recent study from Pew Research, 74 percent of smartphone owners use location-based services. Additionally, 18 percent of smartphone owners use a check-in app.

Although that number might be small to some marketers, the fact is that consumers are interested in sharing their activity with friends and family.

Social media may also play a role in why consumers are more willing to broadcast their location, according to some experts.

However, tying a reward to a strong loyalty aspect is crucial to any campaign.

“You can’t think of a check-in as a one-off,” said Tony Pham, vice president of marketing and engagement at Life360, San Francisco.

“While leaderboards showing where you rank among others with check-ins is a start, providing targeted rewards for each individual’s respective engagement actions with your brand or product will build towards a long-term relationship,” he said.

If a consumer checks-in to a coffee shop on a regular basis, for example, a smart location-based campaign should be able to realize that a user is most likely interested in a deal on coffee.

For instance, Dairy Queen recently rolled out a campaign to reward users who check-in via foursquare and Facebook at several locations (see story).

Dairy Queen's mobile check-in program

On the other hand, offering a discount on a specific product that a consumer has never visited before is not relevant to users.

“Demonstrate that you appreciate loyalty by showing the customer that you don’t view one check-in as indistinguishable from the next,” Mr. Pham said.

Location-based ROI
As consumers use their devices more to find deals and offers, brands and retailers can also benefit by incorporating location-based technology into their marketing mixes.

Not only can a retailer build loyalty with users via mobile, it can also lead to ROI if the offer is relevant and targeted enough, according to Alistair Goodman, CEO of Placecast, San Francisco.

“Proximity to a store can be combined with a host of other data – explicit consumer preferences, past purchase behavior from online or a loyalty program – to deliver an offer that consumers see as a value-added service,” Mr. Goodman said.

Based on data such as past buying behavior and consumer preferences, retailers can use tactics such as geotargeting to entice users to visit a store.

As an incentive, personalized messages such as coupons can be sent to users.

According to Mr. Goodman, Placecast sees more than 50 percent of consumers involved in its location-based services visit a store based on an offer that they received on their phone.

In the future, retailers will link location-based offers to mobile payments, leading to a measurable ROI and foot traffic, per the Placecast exec.

”Location and time are highly predictive of consumer intent – much more so than many other types of observed data such as browsing behavior,” Mr. Goodman said.

“For example, a consumer near a mall on a Saturday morning has their phone and their wallet and is in a mindset to make a purchase. When combined with preference and other data, a consumer can receive an offer that they can take advantage of right there in the moment,” he said.

Final Take
Lauren Johnson is editorial assistant on Mobile Commerce Daily, New York

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