According to a new report from Technavio, the location-based search and advertising market in the US is expected to reach a value of $6.39 billion by 2020, growing at a CAGR of 38.59% from 2015-2020.
What is location-based search and advertising?
Location-based search and advertising is used to differentiate customers based on their interests and location. This is really exciting for marketers, since it provides a surefire way to communicate the right message to the right set of customers at the right time in a meaningful and engaging way. It is a method of direct communication with consumers, and it helps companies figure out the right set of target customers based on their likes, interests, and geographical locations.
Four ways marketers are using location-based advertising to target consumers:
Social media
Facebook, Twitter, Instagram and other social networks have been a goldmine for advertisers. Depending on the user, you can get a pretty clear picture of a person’s likes and dislikes based on what they’ve—well—liked. This means that companies can target customers with ads specifically meant for them.
And the ads only get more specific once you factor in location, which has made location-based services a boon for social media marketing.
Users can access advertisers on social networking sites based on their location, and local companies can easily target customers in their area. This is enhancing the user experience, and, in turn, fueling the growth of location-based search and advertising.
Beacons with micro-location capabilities
Beacons are a slightly newer development in proximity-based marketing. They help retailers cut through the advertising clutter and interact directly with customers using micro-location capabilities.
Beacons communicate with supporting apps and send users a pop-up notification when they pass by the store. The app is pretty key here, as it means that consumers have elected to receive these notifications. Since there’s an element of choice and the content is relevant to particular interests, then there’s a higher chance of the ads actually being effective.
Location-based services using LED fixtures
Use of LED fixtures for location-based services is one of the most cost-effective LBS approaches, as it removes additional hardware infrastructure. Chips embedded in LED-based overhead lights communicate with smartphones, and use sensors to track the direction of a person moving inside a store.
This can help shoppers locate products or services at the right time, and can even provide directions in airports, museums and hospitals. It also allows retailers to offer customized incentives and sales to customers, which in turn leads to increased sales volume.
Location-based pull advertising
Pull advertising is a user-initiated information request, which triggers the delivery of ad content, as opposed to push advertising which is instigated by the advertiser. Location-enabled pull advertising is expected to grow during the forecast period, as prominent location-based ad providers work to develop the platform.
For more information on the location-based advertising market in the US, view Technavio’s new report.
