BrainTrust Query: You Are Here … Like It or Not
Commentary by Doug Stephens, President, Retail Prophet
Through a special arrangement,
presented here for discussion is a summary of a current article from the Retail
Prophet Consulting blog. Retail Prophet Consulting sits as a current member
of the advisory board for the Location-Based Marketing Association of Canada.
recent study by Forrester Research concluded that, while location-based services
(LBS) such as Foursquare, Gowalla and Loopt are intriguing, they are still too
small for major marketers to spend much time on. While current LBS users are
very likely to be influencers within their social circles, they are also largely
male and, therefore, better suited to marketers targeting men. Forrester’s overall
advice to marketers was a resounding “wait-and-see” on LBS.
hard, however, to reconcile the Forrester report with a lot of what’s
happening in the marketplace.
Large players like Starbucks have been experimenting
with services like Foursquare since early 2010, giving in-store discounts and
rewards to users for checking-in to their stores.
The Gap recently launched
a one-day 25 percent off promotion to Foursquare users checking-in at Gap locations.
released LBS applications such as Shopkick tapped by Macy’s, Best Buy and American
Eagle are making news by taking shopper rewards to entirely new and location-specific
levels, literally allowing shoppers to earn rewards simply for moving through
various areas of a store.
And in what is perhaps the ultimate sign that LBS
has arrived, Facebook recently launched its own homegrown location service,
Facebook Places, allowing users to share not only what they’re doing
but also where they’re doing
Indeed, Asif Khan, founder and president of the recently-formed Location-Based
Marketing Association of Canada, believes that those who “move to embrace
LBS early-on will reap enormous rewards from proximity marketing, including
attracting more first-time customers, encouraging more repeat business and
increasing sales. I also see huge opportunities for cross-brand promotion for
companies that have multiple brands like Gap and Old Navy.”
the Forrester study failed to recognize the recent explosive growth of such
services as Foursquare, the potential of Facebook Places to educate consumers
about LBS, as well as exponential smart phone adoption rates.
To that end,
he sees the use of LBS reaching critical mass in 18-24 months.
Mr. Khan agreed
with the often cited quote from techno-anthropologist Clay Shirky, “Communications
tools don’t get socially interesting until they get technologically boring.”
“I don’t think it’s about technology at all,” said
Mr. Khan. “At least, I don’t think people care about which app they
use. They only care about the size and relevance of the deal. For brands and
retailers engaging with these tools, the real measurement of success will not
only be ROI, but Return on Relationship (ROR).”
As for the future and the
continued evolution of location-based technologies, Mr. Khan suggests that
the very context in which we consider the term ‘location’ will also evolve.
“Today, we think of location as only the physical space,” he said. “But
I see a time where we will be in virtual spaces and augmented reality where
brands and content will live as well.”
Discussion Questions: How aggressive
should retailers be around investing in location-based services? What do you
see as the next evolution of LBS?