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The Future of Location-Aware Advertising

Andrew Grill, Mobile Advertising Evangelist - GigafoneAnnual Innovation Conference InnoEstonia 2008

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Introduction

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What we’ll cover

• Why the Starbucks example will never happen

• The location challenge

• What Advertisers want

• What’s here and now

• What’s next

• Location’s place in the mobile advertising value chain

• Where are the revenue opportunities for location advertising?

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Let’s kill off the “Starbucks Example”

Assume the following campaign

50,000 opt-in users

2 week campaign (Mon-Fri) = 10 days

8 hour window (8am – 4pm)

Check location every 5 minutes by operator cell-ID

Assume €0.10 per poll

What would this cost?

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The cost breakdown…

50,000 users10 days8 hours12 polls/hr€0.10 per poll€4.8m

ALMOST5 MILLION Euros!

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What is mobile advertising?

How does location enhance mobile advertising?

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The Mobile Advertising Value Chain

Advertisers need…Advertisers need…Advertisers need…Advertisers need…

Measurability • Ability to track consumer engagement by counting clicks vs. displays • Ability to track consumer engagement by counting clicks vs. displays

Targeting • Aggregated and specific customer information (e.g. age, gender, segment, lifestyle)

• Aggregated and specific customer information (e.g. age, gender, segment, lifestyle)

Relevance • Ads must be conveyed to the precise target in the right context …• Ads must be conveyed to the precise target in the right context …

Location • Information on the consumer location to increase relevance of ads • Information on the consumer location to increase relevance of ads

Advertisers/ Brands

Advertisers/ Brands

Marketing Agencies &

Media Buyers

Marketing Agencies &

Media Buyers

EnablersEnablers Content ProvidersContent

ProvidersAggregatorsAggregators Device

MakersDevice Makers

Wireless OperatorsWireless

Operators SubscribersSubscribers

Traditional Promotional Channels

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Mobile operators don’t have all the data advertisers need

Vodafone Australia mobile advertising brochure

• Gender

• Phone type

• Postcode

• Segmentation

• Age

• Gender

• Spending pattern

• Credit worthiness

• Location??

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Mobile advertising today

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Or….we ask the user’s permission and preference

Dynamic location information can enhance the user experience

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Mobile LBS Landscape

• Significant uptake by consumer of location services – driven by:– Device capabilities (larger - sharper displays , 3G data rates & GPS)– Quality content (maps, POI, navigation engines)– Attractive data tariffs (but not everywhere)

• Current focus around navigation & search

• Future growth expected in location based advertising & social networking

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Mobile LBS Landscape

• Significant growth in LBS, fuelled by convergence of:– Device capabilities (larger - sharper displays , 3G data rates & GPS)– Quality content (maps, POI, navigation engines)– Attractive data tariffs

• Current focus around navigation & search

• Future growth expected in location based advertising & social networking

• The industry can’t wait any longer for operators to provide cell-ID data to 3rd parties – Google, Nokia, Skyhook Wireless are doing it themselves

• Advertisers need cross network and cross country coverage

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What does this all mean for location based advertising?

• Technically possible to provide a location capability

• Until advertisers can use location with scale and ease it will be niche

• Consumers starting to use GPS and operator independent location services and understand the benefits

• Mobile advertising ramping up (Google vs operators)

• Flat rate data plans driving usage

• Location can become advertising inventory

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Google Maps – now with sponsored links

www.google.com/gmm

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WiFi location – Skyhook Wireless

www.skyhookwireless.com

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Blogloc – post your location on a blog

www.blogloc.com

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Shozu + Flickr = geotagged photos

m.shozu.com www.flickr.com

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Rummble – location based social networking

• Free to consumer• Ad / sponsor funded• Timely, trusted, personalised

content

www.rummble.com

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MobGeo – location aware mobile coupons

www.mobgeo.com

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Locatik – location based social networking

www.locatik.com

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“Location Broking” with Fire Eagle from Yahoo!

www.fireeagle.com

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New Friend View service from Nokia

Consumers first need to understand the benefits of a location service

friendview.nokia.com

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Andrew Grill

www.andrewgrill.com/contact

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http://LBS.andrewgrill.comTwitter: @andrewgrill