Commentary

Who's Afraid Of Location Data?

With most brands now adopting mobile, it’s become essential to use location data to more effectively connect with customers. Location data doesn’t simply indicate where users are. It can be used to provide insights about audience segments and their preferences.

Mobile advertisers are willing to pay a premium for location data because of the value it brings.  Five publishers that tracked online ad traffic for over a full year discovered an increase of 19% in eCPMs for requests that included GPS data, compared with those who originated from IP addresses. This higher value was derived not only from the ability to serve users relevant ads for their locations, but also from the ability to map users’ behavior and activities.

Users sometimes resist the fact that location data is being used to track consumer behavior. But there is a great deal of hypocrisy related to location data. On one hand, users complain that their privacy is violated — yet they share their personal data freely when using their favorite mobile apps. In fact, nine in 10 U.S. smartphone owners use location services on their phone, according to data from Pew Research Center.

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Here are five of the most common ways consumers benefit from location based services.

1. Weather:  65% of U.S. mobile app users shared their location with weather apps such as AccuWeather to receive up-to-the- minute forecasts, according to a July 2015 survey conducted by Research Now on behalf of Skyhook Wireless.

2. Shopping: Using location data, shoppers can receive discounts at stores in close proximity, directions on how to get there, and location of specific items inside large department stores.  At a massive sporting event in Paris, Reebok used beacons to invite shoppers to browse the items in its pop-up store.

3. Networking: Location-based social networking services include MeetMe, for meeting like-minded business colleagues for professional enrichments and new job opportunities.  

4. Transportation: Commuters can save time using navigation systems such as Waze, ridesharing services such as Lyft and public transportation apps like Moovit to receive maps, and train and bus schedules.

5. Personal Guides: Venues with large areas like museums and universities use geolocation apps to help visitors find their way. GeoTourist provides personal tour guides for attractions and landmarks by auto-playing guided audio tours based on the visitor’s location.

Despite all the benefits, there are still perceived risks of location based services. Some people can feel uncomfortable sharing their location, concerned that a third party may receive this information without their permission. There are circumstances in which people may not want to reveal their location, for example, if they are attending a religious or political event or if they are receiving medical treatment at a clinic or hospital.

By illicitly gaining access to profiles not adequately secured, criminals could acquire information such as a consumer’s name, address, interests, and friends and co-workers’ names resulting in possible identity theft.

There are also tradeoffs when considering how data is collected.  When a user allows an app to use location data, advertisers have only partial data because once the app is closed, there is no more tracking.  When location data is collected in the background, advertisers may have very accurate information but users are not always aware their data is being shared and their batteries can be drained.  Waze received negative feedback for enabling the app to always run in the background by discontinuing the “use only when open” option.

Still, we’ve reached the point of no return – location data has become an integral part of our everyday life. Rather than fighting location data sharing, it’s best to learn how to use is wisely and securely so that the benefits may be realized. Consumers need to be aware of how their location data is collected and how to block location data when they don’t want it to be shared. In addition, they need assurances that their data is being transmitted in a secure way.

1 comment about "Who's Afraid Of Location Data?".
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  1. Ed Papazian from Media Dynamics Inc, February 24, 2017 at 8:42 a.m.

    Very interesting? I didn't know that "most brands" have "adopted" mobile.

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