Location-based services have yet to reach the tipping point, according to a survey by White Horse.

Most smartphone users are unaware of these apps or do not know what they do, according to the survey. About two-thirds of the smartphone users in the White Horse survey do not use LBS (60.1 percent, or 266 of 437 respondents), and 72.6 percent of this group either ?don?t know about? any of them or ?know about them but don?t know what they do.?

?Marketing organizations from the agency side and the clients themselves are afraid to dip their toe in the water and they not taking advantage of the capabilities inherent to mobile platforms,? said Jamie Beckland, emerging media manager at White Horse, Portland, OR. ?There is not one compelling experience or reason that will get people to opt-in to geoloction software, as there are still some real privacy issues.

?The privacy question is a question of tradeoffs?people are willing to give up some of their privacy if they have a clear understanding of what they?re getting, like a coupon component or a social component?there are all of these different reasons,? he said. ?A brand controlling the geolocation experience wants to create its own experience rather than buying into an existing platform.

?There needs to be a clearer communication of the value exchange for why consumers would want to opt into a geolocation platform?brands can use mobile LBS to build deeper engagement with the most loyal, best customers that they already have a relationship with.?

White Horse completed an online study of 437 smartphone users February 16-23.

The study set out to establish whether location-based services such as Foursquare and Facebook Places are reaching the tipping point; what barriers might be preventing acceptance; who is using these services now; and how marketers might address barriers, and engage consumers, to better utilize the medium as it matures.

Key findings
If the experience were attractive, we would expect to see that signing up was on more of the non-users? to-do list lists. But most of the non-users who do know something about these apps are either ?not interested? (56 percent) or ?have concerns? about them (24 percent).

The majority of people who use the apps today check-in several times per week, not several times per day, as they do social networks.

Examples of survey respondents? comments: ?They sort of freak me out. I'm not sure that it?s good to always let others know my location? (woman, age 20-29, Atlanta GA); ?I'm not sure why anyone would care that I was at a certain restaurant, etc.? (man, age 40-49, Nashville TN); ?I stay connected to people I know in other ways? (woman, age 30-39, Merrimack NH).

Reasons for non-use among non-users most familiar with the LBS apps (n=73) include privacy concerns (32.9 percent), no need/interest/benefit (26 percent), redundant to how I already connect (19.2 percent), miscellaneous (6.8 percent), no time to explore (5.5 percent), intrusive to others/inappropriate (4.1 percent), live in a small community (2.7 percent) and use someone else's (2.7 percent).

People who use the apps today believe they are making concessions to privacy that make them uneasy?35 percent believe they are broadcasting their ?real name? with check-ins.

A majority of defectors?nominal users who ?no longer use? the apps?have relatively low confidence that their privacy was secure.

The majority of non-users is female?64.6 percent, or 53 out of 82.

Users are mostly young, active contributors to social networks.

People who are aware of these apps tend to be younger, with most in their 20s, others in their 30s. They are active and frequent contributors to online social networks such as Facebook.

Consumers who use dedicated geolocation apps such as Foursquare and Google Latitude, with communities built from the ground up, say that ?others seek their opinions? when it comes to location-based mobile apps.

Users of Facebook Places, however, do not perceive distinctions in their influence.

Marketers who understand location-based participation dynamics have an immediate opportunity to improve their competitive position, per White Horse.

While the benefits of geolocation have yet to be realized, strong competitive advantage exists for brands that understand the medium.

An opportunity exists to engage consumers now by helping them build small, trusted communities around shared interests, per White Horse.

Brands that succeed at leveraging geolocation should start from the premise that, today, it is a specific type of social media.

A consensus has emerged that the location-based experience is about ?social connection? and related benefits such as recommendations, for example, ?finding a place liked by people I trust.?

Privacy fears arise from specific concerns, such as sharing information about friends, sharing real names, and fully deleting histories, which can be overcome?if not turned to competitive advantage?by addressing them directly and transparently, per White Horse.

Users are willing to share a good deal of information with app developers and merchants, so long as they receive clear benefits in return.

There are only a few areas where consumers are willing to give markedly less information than merchants and app developers currently seek, per White Horse.

?Timing can be really critical, and we want to make sure that the brands we serve understand that, with geolocation services, we?re finding it is an element of the mobile ecosystem that isn?t there yet but will be there soon,? said Will Reese, director of digital futures group at White Horse, Portland, OR. ?Competitors are going to be on top of this.

?We?re focusing on how to build that experience?the strategy is you have to build an experience,? he said. ?Mobile LBS is fundamentally another element of a social networking experience, and you have to build on that to be successful.

?Some LBS users are coming in strictly from a coupon perspective?people don?t know when they are first using the service what check-in means, so we can do a better job with education and through the design itself.?

Final Take
Google Latitude