Location-Based Data for Customer, Advertising, and Competitive Insights
By Mark Ailsworth
Today’s modern marketers are expected to be data-driven, with every choice backed by a data component which guides decision making.
But, sometimes, it’s easier said than done.
What data to use? Which metrics? Which KPIs? What date range? If you look at a campaign after the first week, it may look like it’s doing really well. Wait a few weeks and maybe performance has cooled off. Do you pull the plug? Wait another few weeks and now the campaign is “working” again. Do you double-down and add more budget?
How does a marketer evaluate their various datasets to best understand which are valuable and which are not?
The answers to what/how/when regarding data are for every marketing organization to figure key to having a successful data-driven marketing program. One of the best ways to know how much faith you should put into a dataset is how useful it is when the insights it presents are applied to real situations. For marketers, that means making decisions with those insights and then seeing if your choices paid off.
Every industry has its leading dataset
In every industry, there are pillar-datasets that are proven to be extremely valuable and useful and have become the gold-standard for that category. It doesn’t mean there aren’t challenges associated with the dataset, but they have proven themselves to be the most useful intel for those categories and every company of that type uses them.
Some examples include:
- Polk data for the automotive industry
- NCS (Nielsen Catalina Solutions) for the consumer packaged goods (CPG) industry
- The Leading Economic Indicators for the finance industry
For marketers of companies that rely on brick & mortar sales, location-based data has become the new gold-standard for that industry.
It’s a relatively new type of dataset that has been around for about a decade snf uses permission-based, smartphone tracking to understand consumer movement patterns at scale. Where they go in a day, how far they travel for specific tasks, how often they do so, etc.
For location-based marketers, you’ve already been using this data for years with your ad targeting.
But, did you know that location-based data offers a treasure trove of insights that can be game changing for your marketing organization?
3 Types of Questions That Location-Based Data Can Answer for Marketers
In a recent survey, marketers identified many valuable use cases for location-based data.
The following are the three buckets of the types of questions reported as being the most critical questions that this data can answer:
Location-based data answers questions about customers
Being customer-led is an important key to engaging today’s consumers as they research purchase decisions before buying. Understanding their needs, how they plan to solve those problems, and what makes them eventually convert at a brick & mortar location is critical for marketers.
Insights into the customer journey. Trends in customer movement patterns can help unlock how consumers think. For example, maybe you discover that before customers visit your home improvement center, many of them visit individual specialty locations first (i.e. flooring store, cabinet store, landscaping store, etc.) This intel can help you understand which categories of promotions you should be highlighting in your local ads—for example, for one location you might need to push landscaping to combat a big competitor in the area versus in another location a paint store rival might be your concern.
Influencing in-store activity. When tied to in-store sales, your marketing team can analyze customers who spend a lot versus customers who spend a little. You might discover that people who drive more than 5 miles to get to your location end up spending more than people who live nearby. That could change your targeting scope for how you market. That could be different for each store so understanding the radius of influence you need to drive the best results is valuable information for your store-level media plan.
How much time consumers spend at a location. Maybe you know that the longer a customer spends at your big-box retailer stores, the more they tend to spend. In the locations that come under the average time per visit time, marketers might be interest in running events and in-store demos to help drive the time up as a way to increase sales.
Location-based data answers questions about advertising effectiveness
Accurate measurement is still an issue facing all marketers. Location-based data offers insights into advertising performance that other methods just can’t deliver.
Types of consumers to target with advertising. When location-data is paired with cutting-edge segmentation, marketers can analyze the movement behavior of different types of customers. As more segment-based campaigns are run, it will become clear which segments are more impacted by advertising and which ones aren’t as easy to influence. Over time, marketers will be able to know which types of campaigns and messages best work to drive business performance.
Which media channels perform best. Location-based data is a very valuable piece of a marketer’s total measurement approach. Clicks, likes, and shares are great, but if they don’t drive consumers into physical locations to spend money, then the marketing investment will show a poor return. Using location-based insights in combination with modern marketing measurement techniques is invaluable for physical businesses to optimize their marketing plans with the ideal channel mix.
Location-based data answers questions about competitors
The reality of today’s highly competitive market, it’s not about converting consumers as much as it is about taking market share away from others. Having a strong eye on your rivals is keenly important for marketers, and location-based brands can find that information with location-based data.
Where do consumers go after visiting our location. It isn’t too far of a leap to realize that if a shopper doesn’t find what they want at your store, that they’ll go elsewhere to buy. Trending out customer movement trends over time helps you understand the health of your location in each market. Marketers can try to combat this behavior by targeting the consumers most likely to price shop with highly competitive offers so that when they come to your store, they are there to buy.
How does our brand perform against the competition. Everyone at a company—even outside of the marketing team—always wants to know how well they are doing against their rivals. Some companies are singularly focused on a single competitor who is standing the way of market dominance. For location-based businesses with location-based competitors, knowing the volume and quality of foot traffic to their rivals’ locations is extremely important and just might be the most valuable question that the dataset can answer. Armed with this information, practitioners can plan each market’s media strategy accordingly; knowing where and how much they need to focus in order to best drive the bottom-line.
Location-based data + segmentation is the winning combination
Location-based data is great, but in its raw form, it can be rather large and challenging for marketers to pull out the kinds of powerful customer, advertising, and competitive insights as described in this post.
Segmentation breaks down location data into smaller parts so that marketers can best understand what levers to pull to drive performance. Using a segmentation partner like simMachines’ adds tremendous value to your location-data investment.
As my colleague Danny Shaman wrote recently in his post, Location-Based Marketers: Are You Missing a Key Ingredient to Your Location Data Strategy?:
“With customer segments as the most granular level of location data, marketers can derive meaningful insights, such as how far do certain segments drive to reach them. Which segments are reacting well to marketing messages? Which competitors are gaining an edge on your most important customers? These are the data points that today’s location-based marketers must know to have any chance in protecting and growing market share.
Without proper segmentation, a location data investment just isn’t as valuable. It’s valuable, but it needs to be organized at the customer level in order to truly unlock the full power of how location-based data can give marketers the edge they need.”
Have been able to extract the full value of location data to help your marketing organization?
If not, let’s chat. Here’s my email address: firstname.lastname@example.org. Let’s talk about how location data + segmentation can be a game changer for your business.