- Placecast approaches to taking consumer interest using O2 system. O2 customers opt into the system by providing their age, gender and interest. When customers are near an outlet that matches their profile, they receive an SMS message for money off or other special offers. The service is based on a technology called “geo-fencing”.
- Targeted marketing reduces the likelihood of relevant marketing messages being lost in “junk mail” that is, customers get texts that they know are probably relevant. According to research carried out by placecast on shop alerts users, most customers opened the alerts immediately and 65 percent made a purchase as a result if receiving the text (interestingly, not always a purchase mentioned in the text). O2 had to resolve several issues with this type of marketing: opt in and opt out, age (not available to customer younger than age 16), data sharing, frequency (one message per day) and device (works on any mobile phone).
- Adlocal (now part of yahoo Japan) has the largest share of Japan’s location-based advertising market (valued at US$1b) and such technology can make sure that the advertising that user receives is based not necessarily on who they are but where there are. Advertisers create their own advertisement using a wizard and then specify the desired locations and dates to display them (for special promotions, discount, etc).
Do you think that targeted advertising is better than a blanket approach? What is the difference for the advertiser? For the consumer?
- Yes, it is better, targeted advertising at the right consumer at the right time when they are in the right location to make a purchase. When consumers are near an outlet that matches their profile, they can do the transaction immediately.
- This is why it is correct to say that targeted advertising is more interesting and effective for the consumer. First, messages received are usually relevant, considering the consumer’s location, gender, age, etc. Second, customers are usually able to control all information from advertising companies because they can opt-in and opt-out the services.
- Finally, customers should not spend their time reading the information they do not want to know or even do not hear. At the same time, a blanket approach seems to be more effective for the advertiser due to a variety of possibilities. First, advertisers are free to choose the necessary commercial region for their services. Second, blanket approach management is easy and does not require too many skills. Finally, advertisers share all information about the services they have. At least, this approach provides advertisers with the hope that customers may learn and be familiarized with their offers.
The information from the comScore survey did not differentiate between age groups, only country. Do you think there are differences in behavior among different age groups that would make location-based marketing better for one group than another?
- The survey offered by comScore about the necessity to consider the differences between countries and neglect age different is an interesting approach; still, it is not quite appropriate for the marketing sphere. In fact, different age groups may have different interests and, thereafter, behaviors. In addition, people of different age have various levels of knowledge about current technologies and their own abilities in regards to these technologies.
- Finally, older people are not always aware of what information is necessary to give and what facts are better to omit. This is why the elderly are usually the users of such services like AdLocal, and the youth enjoy the benefits of the services like Placecast (O2, 2010). As a result of this brief analysis, it is possible to say that location-based marketing can be better for one group and less interesting for another group of people.
Think of businesses in your area that might benefit from joining the O2 scheme. What could they offer?
- The O2 scheme may lead to a number of benefits for a company that wants to have as many regular and new customers as possible. For example, the sphere of such business as the fast-food industry can win a lot due to the O2 scheme.
- A person may walk in a city and get as many ideas of where to have a bite as possible, taking into consideration personal interests and preferences. This is why if a person mentions that he/she is a vegetarian, he/she will be offered the services at special magazines or the restaurants with an appropriate menu. There is also no necessity to set up special apps and think that their work can influence the battery charge (O2, 2010). The use of this program is safe and not challenging.
