Improving location tech will get more to opt-in
January 4, 2010
Spot the opportunity
Polaris Wireless is predicting that for consumers to get more comfortable with location-based services, technical problems will have to be addressed in 2010.
The company is predicting that with 4G on the horizon, 2010 will see more devices going wireless, similar to Amazon’s Kindle. Location-based services will also benefit from spatial context, for example, knowing when a consumer is walking by a coffee shop.
“As compared to the PC and Internet world, the mobile device is now as personal to an individual as their own wallet,” said Martin Feuerstein, chief technology officer of Polaris Wireless, Santa Clara, CA.
“Most consumers today are not open to receiving communication in the form of unsolicited advertising unless it is initiated by them for a specific purpose,” he said.
“From a technology perspective, it is important that the mobile marketing and advertising world understands the customer’s need, their profile and usage patterns.”
Martin Feuerstein
Polaris Wireless is a service provider of software-based, location systems that determine the location of mobile phones.
Locating fears
Mr. Feuerstein said location-based services will raise a huge concern from a privacy perspective and those concerns will continue in 2010.
Consumers today are still skeptical about how mobile marketing and advertising opt-in scenarios will expose their privacy. This causes adoption issues.
Mr. Feuerstein said previous market trials of opt-in and privacy settings have shown that initially consumers were hesitant. But once they experienced the tangible benefits of a relevant service, they became comfortable with loosening privacy settings.
According to Polaris Wireless, another technical challenge is the lack of high accuracy location in dense urban and indoor areas where most consumers use their phones for accessing various applications.
“High-accuracy location technologies for dense urban and indoor areas do exist but wireless service providers have not deployed the same,” Mr. Feuerstein said. “High-accuracy location in areas where consumers use their phones the most will provide the required context and relevance required for mobile marketing and advertising to succeed.
“It will result in high service adoption and coupon redemption rates for advertising brands,” he said.
Mad for ads
The current mobile advertising business models do not compensate and therefore motivate consumers to receive mobile advertising, per Mr. Feuerstein.
Once the technical challenges are solved and solutions are put in place, location-based services experience for the consumer will most likely improve.
Mr. Feuerstein said besides a rich location-based services experience, the critical aspect for getting consumers to opt-in is the consumer benefit of financial motivation.
If consumers get a few dollars off their monthly statement or access to exclusive coupons not available through other sources, it may lead to higher opt-in rates.
“The key differentiator between effective mobile advertising versus spam is the relevance to the consumer,” Mr. Feuerstein said. “Mobile coupons delivered at the incorrect location, at an inappropriate time or to an unreceptive person are worse than junk mail because of their annoyance to the customer.
“Getting it right for mobile advertising requires the correct targeting through a combination of precise location, pertinent time, receptive, opted-in consumer and, most importantly, a rewarding experience through a financial benefit,” he said.