In Targeting Luxury Buyers, Location Is The Secret That's Too Good to Keep

For any brand, targeting and engaging your preferred audience is key – and, in the grand scheme of digital marketing challenges, it’s not that hard anymore. We have access to data that shows us how our target audiences behave and what they like. Marketers who embrace and understand the signals, can speak to their audiences at scale and convert.

For the luxury brand, though, scale is not enough. In this sea of data, luxury consumers are elusive. There are fewer of them, and for marketing efforts to have the desired impact, luxury brands want to reach their audiences and bring foot traffic to the point of purchase.

To that end, location-powered advertising adds a dramatic and effective layer to a luxury brand’s campaigns. One that must be considered when brands want to drive conversions and reduce wasted spending. Forward-thinking brands understand how location-based advertising is a winner for targeting the luxury consumer in more precise, impactful ways, and for motivating the consumer to the point of purchase. Plus, location introduces a whole new set of insights about how effective the luxury brand’s strategies were in accomplishing its goals.



As it stands, advertising methods for the luxury audience tends to paint in brush strokes that are too broad. Think about targeting digital ads mainly around content that might interest the luxury consumer, desktop cookie targeting or out-of-home advertising. These might be ways to reach the affluent consumer, but they’re a great way to reach the aspirational consumer, daydreaming about luxury goods they’ll rarely (if ever) go out and buy. The brass ring is the consumer who actually goes in-store – or on-lot, or on-plane – and purchases those luxury goods and services. To reach those consumers, the luxury brand will want to understand data from the locations where these things are bought and sold.

The secret sauce in the luxury recipe is location-based targeting, which, when combined with behavior insights from audience data, can produce a potent and granular strategy. Location targeting adds some highly effective and valuable tools to the luxury brand’s arsenal: First, helps brands target and attribute consumers to exact proximities – for example, inside a luxury store. Second, it helps brands build custom audience profiles based in part on their location history – that is to say, consumers that have visited certain luxury retail stores, or whose location indicates they live on a high-income residential block. Third, it helps match devices to household demographics and transaction history – for example, a household at an address where a luxury vehicle is registered, or where credit card bills frequently show luxury purchases.

One of the benefits of these precise, extremely relevant location insights for an advertiser is in retargeting. Imagine, as a brand, having the opportunity to retarget to consumers who actually went – maybe multiple times in the past month — to Saks, Barneys or Prada stores, or who have made repeat visits to luxury vacation destinations, or who have a luxury automobile in their garages. Imagine being able to reach them on days and at times when the data shows a consistent pattern of those consumers shopping for your or your competitor’s product. Imagine if those insights extend to the street block or household level. Location data goes far beyond interest in the luxury brand and into how those brands and their products or services play into consumers’ day-to-day lives.

We don’t need to imagine it. Case studies prove a strong correlation between proximity to the point of purchase and performance of ads and a direct correlation between CTR and lift in foot traffic at point of purchase. Specifically, those studies of advertising to targeted luxury consumers find optimal CTR was one to two miles from a department store. Studies show location-based advertising achieving three times the CTR of non-location based targeted advertising, and a 70% increase in foot traffic for specific campaigns. Overlapping social graph data – Likes, Check-ins, Pins, Tweets and so on – with location data allows for highly precise and impactful targeting. The combination of location history data, demographic insights and transaction data can help create custom audience profiles that are much more valuable and worthwhile to the luxury brand than the alternatives currently available.

Accurate, relevant location data and smart data analysis before and during a campaign can provide extremely worthwhile insights for the luxury brand in planning its marketing strategy and optimizing performance. Any luxury brand looking for the secret for turning reach into real transactions needs to understand: It’s in understanding where your luxury consumers are, and where you can find them again and again.

1 comment about "In Targeting Luxury Buyers, Location Is The Secret That's Too Good to Keep".
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  1. Hannah Morell from Arizona State University, September 16, 2014 at 1:35 a.m.

    I love how this article explores the art of advertising and targeting deeper than many people would normally consider. The luxury market is a small, exclusive niche, which requires additional attentiveness. This article poses location-based advertising as the link between audiences and authentic customers, which is a connection I have never thought to make before.

    I’m surprised by the amount of market research goes into fine-tuning this specific advertising approach. This location-based advertising gathers information on consumer’s cars, neighborhoods, and credit cards and allows brand to know their customer to the “T”. I am currently taking a marketing research class and am exploring ways that organizations collect and use data. I never would have guessed that I would link that knowledge to the concept of advertising!

    I was interested by the idea of brands knowing when specific consumers shop for their products as well as competitor’s. The article didn’t explain much about what brands would do with that knowledge, but I would like to know how they would go about advertising to consumers during those times. I would assume that brands would accumulate data on location analysis and run ads in the form of pop-ups and banners specifically during the times when shopper volume is high. However, many luxury brands advertise in magazines and other forms of print, which is not as easily controllable in terms of location. How would brands use location-based advertising in that case?

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