The following is a guest post from Mike Schneider and Aaron Strout, co-authors of Location-Based Marketing for Dummies. Mike is the senior vice president, director of digital incubator for allen & gerritsen. Aaron heads location-based marketing efforts at WCG. You can read more about Aaron and Mike here: http://locationbasedmarketingfordummies.com.
What is Location-Based Marketing? While an official definition doesn't yet exist for location-based marketing, we (Mike and Aaron) like to explain it as the art of engaging your customers and prospects using services like foursquare, Yelp, SCVNGR and Gowalla to drive loyalty, word of mouth marketing and referrals. These services are mostly available on smart phones (mobile phones that are web and GPS enabled) and allow users to "check in" to a physical location such as a restaurant, bar, print shop or dentist's office. Some of these services allow the businesses to reward their customers for checking in with special discounts, prizes, experiences and recognition.
Because more and more people are starting to use smart phones, it's becoming easier for software and application developers to take advantage of knowing within a tight radius, where someone is assuming that "someone" doesn't mind revealing their current location. The key here is for marketers and small business owners to provide enough value (discounts, prizes, recognition etc.) for customers to want to check in so that customers will share their data with them. Over time, marketers and business owners can leverage this rich data (age, sex, past check-in behavior, frequency of checking in, etc.). Even better, if the location is cool enough or the offer compelling enough, marketers and business owners can count on their customers sharing their "check ins" with their networks on places like Facebook, Twitter and Google +.
How Does a Business Get Started with a Location-Based Marketing Campaign?Knowing that people like lists, we've put together a straightforward blueprint for companies to help them think about how they might go about building a location-based marketing campaign. This isn't everything you need to know, it's a good primer for getting started. If you're really interested in digging in, we hear there is a good book to help you get started (shameless plug, we know).
- Set goals: Are you looking to drive foot traffic? Loyalty? Sales? Engagement? Think about how to measure this.
- Claim your location: simply put, search for your business across the top LBS (foursquare, Yelp, Gowalla and SCVNGR) and put a "claim" in on your business's location(s). In most cases, this is a ten minute process. While you're at it, make sure you take a look at your location on Google Places.
- Pick a service (or two) to support: Find 1-2 services to use (hint: if you’re in the travel and entertainment industry, Gowalla is a great choice). One way to decide which service(s) are right for you is to see how active your customers are across each service.
- Reach out to your Influencers: Find out who your influencers are (the mayor, ambassador or the person at the top of your leader board is usually a good place to start) and get to know them. Heck, invite them in for coffee, lunch, a wine tasting.
- Pick a great offer: Note that “great” doesn’t equal “expensive.” Sometimes, a sign in your store/venue honoring the “mayor” might be enough. My co-author, Mike Schneider, and I have what we call the “Ben & Jerry’s Rule” named after one of the first successful campaigns ever to roll out on foursquare. They offered 3 scoops of ice cream for $3 for everyone that checked in (cost for 3 scoops is normally $5.50). And even better, the mayor got a free extra scoop.
- Measure, refine and optimize: This one is pretty straightforward. Have a plan and execute against it.
- Gamification FTW: Don’t be afraid to leverage the “game dynamics” of some of these platforms as appropriate. For instance, on SCNVGR, you might give extra points for a picture with the store manager. Or if you sell coffee, a bonus for the best drink recommendation.
- Let people know about your campaign: Remember to let people know about your program by putting up signs, telling them in your newsletter, including a mention on your “on hold” music, etc.
- Operationalize, operationalize, operationalize: This means that if you are going to run a location based marketing campaign, train your employees. Train yourself. And make sure you have whatever it is that you’re promising. Not operationalizing is where many companies fall down.
- Try out an API: If you are tech savvy (or have some tech savvy developers), try experimenting with some of the APIs these location based platform providers make available for free. You can jazz up your website or your mobile app.
- Passive Checking In / Precision: Reward cards like Tasti-D-Lite's check people in automatically using the foursquare API, but companies like Shopkick are experimenting with sound wave emitters that can track people to specific aisles of a store and test whether they can get people to spend with targeted offers, but also see if they can get them to change behavior. I remember proposing similar technology to a pharma client which did the same using RFID trackers. They thought this was too icky, but Shopkick, according to some chats I've had with Forrester has 2.5 million users and 40% are active. That is huge and represents a seriously amazing opportunity to get to shoppers and interact with / influence them at decision point.
- Intent / Future: Applications like Forecast, Plancast and Ditto have people telling where they are going to be. This represents a huge opportunity for merchants to use structured data to serve a group of people who need their services, or to attempt to change their intended behavior. The first ones into the pool get the advantage and I bet they get it at almost zero cost.
- In a status or meta data: Facebook, like Google+ is using location as a feature and it's actually pretty brilliant because they are getting more than just a check in. They're getting personal and professional expressions wrapped around a location. The problem is that the data is still highly unstructured and difficult to analyze, but if anyone can figure it out, it's Google. Look for them to do cool things with the location data that you provide to Google+. I see recommendations based on what your friends or others like you like without you having to answer many questions.
- Recommendation Engines: Bizzy and WHERE are the leaders in this category. Bizzy recently integrated with foursquare so they can pull in your locations and add places you have been to their recommendation technology. They also have a concept of "checking out" [BTW are the shenanigans at techcrunch wacky or what? start another blog Mike] where you rate your experience in a structured manner. They also just released a reminder notification that pings you 60 minutes after you check-in on foursquare to remind you to check out on Bizzy.
- At Point of Sale: Screw checking in, just pay. Technologies like The LevelUp are capturing your location, but they aren't broadcasting it to anyone (yet). Instead they're quietly building a future-forward loyalty, cross merchant loyalty program that will have one of the most interesting sets of data anyone has seen. Look for them to possibly merge with SCVNGR at some point and connect the social aspects. For now, though, we'll take one step mobile payments and behind-the-scenes discounts on anything we want. You can leave your wallet at home!