Location Based Targeting

Due to the unrelenting progression of technological advancements, modern advertising strategies are becoming ever more personalized, allowing businesses to optimize their marketing efforts and pin-point their intended audiences to a degree that was previously unattainable. But despite the upside of this advertising gold rush, it’s crucial to recognize its inherent shortcomings so as not to go after fool’s gold.

Location-based advertising is the most recent craze in the trend toward more personalized advertising approaches. In the United States alone, location-based mobile ad spending is projected to reach $38.7 billion by 2020 (which is roughly $12 billion more than 2019), according to a report by BIA/Kelsey. Because seemingly everyone these days has a phone either in their pocket or in their hand, and because most of these phones are location-enabled, the ability to leverage consumer location in the modern age is groundbreaking. Where a person lives and travels greatly affects their buying patterns – the purchasing mindset of a person in Minnesota, for example, is affected by seasonal weather considerations much more than someone in southern California – so being able to bypass consumers who aren’t likely to be interested in your product based on where they live or travel has tremendous benefit and upside. However, it is crucial to keep in mind that location is not a perfect metric for predicting consumer interest, and placing too much emphasis on it could be detrimental.

The Achilles’ heel of location-based advertising is that it oversimplifies human thought processes. For products and services that are greatly associated with geographical factors (e.g., clothing, outdoor industries, etc.) location may be a sufficient enough metric on which to base the majority of your advertising efforts, but in most cases, location is not only an insufficient metric but an occasionally misleading and detrimental one, as well. The bottom line is that human beings are complex, and no one metric can successfully predict our buying interests. The natural response, then, in this age of information, has been to collect as many data points on consumers as possible. Age, gender, web-tracking, and the boundless amount of personal information that people knowingly (and unknowingly) relinquish to social media platforms and apps all contribute to a database of information that businesses are trying to tap into. However, it is easy to see that this approach walks a fine line between advertising and intrusion of privacy, and many businesses have already been accused, and in some cases reprimanded, for not taking that line very seriously.

What, then, is the future of more personalized advertising? It is obvious that it still has an upward trajectory, but it is also obvious that it has a definite ceiling. Advertisers in the coming years will be responsible for respecting consumer privacy while still trying to make their advertising efforts as personalized as possible. The only way to accomplish this will be to read between the lines (or in this case the data points) and to focus more on consumer behavior than superficial consumer attributes. Data can be extremely useful, but it can be equally misleading. In order to avoid fool’s gold, it is crucial not to rely too much on outward appearance. At the end of the day, who people appear to be on a sheet of paper, and especially who they appear to be on a social media page, is not who they are in reality; and in an age that is relying increasingly more on information, remembering this is imperative.