Tech Trends: Location App-Based Advertising

A new technology stream is changing the way local companies connect with their audiences. The proliferation of app programs dedicated to helping individuals navigate through local areas—such as Waze and Google Maps—are creating a new advertising channel to leverage. As these programs increasingly incorporate advertising into their design, local businesses can appear when prospective customers are in their geographic location. Here’s a closer look at how to evaluate whether this model is right for your business and how to get the most out of your location app-based advertising campaign.

Is app-based advertising right for you? In order to answer this question, it is important to consider how users leverage this technology. Today users will turn on the location-based features of their phone and then enter their destination into the GPS. From there, the application will provide them with precise directions on how to reach wherever they’re headed. With location app-based advertising, suggestions will pop up along the way. For example, users who need gas can see what gas stations are available in their immediate area, or they can receive restaurant recommendations around dinnertime. This type of advertising works best for local businesses with a brick-and-mortar location travelers or commuters can stop at to fulfill a specific need, such as buying a product or finding a service.

On-demand versus suggested: Apps use different models to integrate advertising content into their applications. In some cases, advertising information is available on demand. In this case, a hungry traveler would ask the software for a restaurant recommendation, and advertisers in the immediate area would appear. When an application uses a suggestion or recommendation model, travelers see information in different categories as they move past specific points. It’s important to understand which approach the application uses and how you will be paying for those views. For example, a person who is searching for a restaurant is more likely to take a recommendation and make a purchase than someone who is simply driving by a location and seeing that a restaurant is situated there.

Targeting options: Running an app-based location campaign is only valuable if you are reaching your desired customers. Therefore, it is useful to understand how detailed the targeting options are for the advertising functionality. For example, you know that one set of criteria is where the end user is located in connection with your business. A recommendation to someone who is hours away is less likely to convert to new business. However, the best options will offer targeting that lets you select on demographic and behavioral information. For example, if people drive by your location every day, they may be more likely to give you a try. If you know busy mothers tend to be business customers, the ability to target those users within the application will help you maximize the return on your investment as part of your campaign.

For brick-and-mortar businesses, the ability to use location-based advertising can help reach a whole new customer set. However, before taking the plunge and investing in this type of campaign, take the time to understand how the application works, how they serve up content to their users, and what targeting capabilities are available to advertisers. The ability to connect with on-the-go customers in your immediate area may help you yield the best possible return on investment (ROI) over the life of your campaign.