Are We Ready for Location Based Marketing?

Forrester Research released a study this week that found that only 4% of U.S. online adults have ever used location-based mobile apps. This has serious implications for marketers who are considering investing in location based services (LBS) as a new piece of their integrated marketing strategy.

An article published on AdAge.com highlights some of the stats found in the Forrester report and provides some relevant insight to the current usage of other mobile apps such as Twitter. In addition, the study—which was released on July 26, 2010—has sent a ripple through the blogosphere attracting much criticism.

Forrester concludes that “bold, male-targeted marketers start testing but that most marketers should wait until they can get a bigger bang for their buck, when adoption rates increase and established players emerge from the fray.”

Is this a good recommendation?

Location based service providers such as Foursquare and Near Here have drawn significant attention from marketers as an attractive and viable way to reach new customers. According to Foursquare, “As a business owner, you can use foursquare to engage your increasingly mobile customers with foursquare "Specials," which are discounts and prizes you can offer your loyal customers when they check in on foursquare at your venue.” The article continues, “Additionally, if you offer foursquare Specials to your customers, you will be able to track how your venue is performing over time thanks to our robust set of venue analytics — for free!” Given the popularity of GPS, Twitter, Facebook, Wiki’s and the literally thousands of iPhone and other mobile apps it is not far fetched to imagine the potential that Location Based Services has to offer.

It is a fact that only a very small percentage has ever heard of location based services let alone adopted the technology. However, history tells us that many of the most successful digital technologies have been a boon for early adopters. For Forrester to say that marketers should wait until the Location Based technology is more widely adopted is short sighted at best. By the time time the market has embraced the technology the marketers who established themselves early on will have not only have gained learning curve benefits, but they will have secured a large amount of market share to be had from the technology. The marketers who decide to wait will be playing catch-up to those who capitalized early on.

In an unrelated story, Facebook CEO Mark Zuckerberg announced last month at a London press conference “We are finishing designing our application soon and hope to offer it soon.” If a the social media giant were to launch a LBS application it would certainly increase awareness of the technology among consumers.

Given the buzz surrounding Location Based Technology and the potential for adoption in the near future, marketers should think twice before taking the advice of Forrester.