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Why does Location Intelligence matter in Out- of- Home?

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Why Does Location Intelligence Matter in Out-of-Home?

What is Location Intelligence?

A term that has become a buzzword in the realm of business, Location Intelligence (LI) is a discipline that comprises analytical techniques to transform and decipher spatially referenced data, which is then used to derive more informed and rational business decisions [2]. In short, LI is the convergence of Business Intelligence, Artificial Intelligence and Geographic Information Systems technology.

Out-of-Home (OOH) prevails to this day, with approximately 39.42 billion U.S. dollars in Global OOH advertising expenditure in the year 2019 [1]. But how has OOH managed to catch up with its digital platform competitors and remain impactful in the modern era?

In its latest “upgrade”,  OOH advertising has evolved into what we now know as Digital OOH—OOH fueled by Advertising Technology. DOOH offers interactive advertising, personalization, hypertargeting, retargeting, geofencing, dynamic creative optimization, and so much more to the advertising world. But this cutting-edge technology comes at a price (literally).

It is no secret that DOOH is a huge investment for marketers and brands. And with greater budgets, comes a greater need to Optimize Return on Ad Spend. It is no surprise that what is fueling this success is in fact the use of location intelligence. 

And Why Does It Matter? 

Let’s think about it for a second. OOH prevails because of digitization, where more and more  screens adopt digital facades. Digital screens, on the other hand, are starting to adopt technology such as ad-tech platforms to manage, optimize, and deliver creatives very similarly in the way digital online does. Behind these technologies and platforms, what runs or rather ‘the brains’ of the entire transaction comes from the use of location data. 

For marketers today, identifying and predicting consumer movement is becoming a priority. Leveraging such forms of data would provide businesses with the head start that they need to stay ahead of competitors. Not only that, but it would allow brands the opportunity to also deliver on expectations to truly create a strong brand presence both offline and online.

Location intelligence can help a brand understand how many times a consumer has been exposed to their advertising across both online and offline channels. If the consumer converts - whether by physically visiting a store location or visiting an online store, the marketer can then understand the optimum frequency of brand exposure that drove this conversion.

These learnings can then be used to optimize future campaigns. Brands, both digital and physical, are rushing to understand the implications of location data because it has been identified as the link between offline and online consumer activities. 

What insights have you derived from consumer movement information and how do you convert it into effective campaign decisions?

Location Intelligence and Out-of-Home: Enhancing an Age-Old Media

  1. Site Selection

OOH media has always been closely associated with physical locations, be it static locations such as billboards, facades, and transit shelter displays, or transit media on the side of public locomotives. Ad placement in the right areas with criteria specifically tailored to a marketer's brand, product, message, and physical stores can make or break an advertising campaign. This is why knowledge about physical locations is vital in OOH advertising. LI provides in-depth knowledge of various attributes of a physical location and structure, such as its name, address, coordinates, and function. Taking into account Points of Interest (POI) and physical landmarks within close proximity to OOH sites as well as the context of the location—whether the location and the surrounding structures’ primary functions are for work, commute, travel, recreation, etc.—can significantly increase revenue while simultaneously decreasing ad spend by assuring proper site selection.

  1. Hypertargeting

Currently, there are approximately 7.6 billion people in the world, and a few million in your country, depending on where you live. More often than not, a marketer’s goal is not to reach every single one of those people. Each brand would naturally have a specific target audience who would be more likely to purchase, use, and endorse its products. LI enables marketers to deliver personalized and relevant messages to the right audiences and avoid spending their ad budgets on uninterested people, by providing insight on where their target audience regularly frequents at what time of day. This allows for better location selection for ad placement, as well as the option to play your ad only during hours of high traffic for your specific target audience.

  1. Retargeting

Retargeting audiences who have already engaged with your ad campaign can help generate new leads and generate more sales by targeting the right people. With the help of LI, marketers can reconnect with people who have been within the vicinity of a screen their ad was playing in through a different channel, offering discounts and promotions, to increase the likelihood of purchase and generate more revenue.

This can be achieved through a strategy known as omnichannel marketing: the unification of various marketing channels with the objective of creating a consistent brand experience.  Now, in theory, it sounds great. But does it really work?

A study conducted in the United States and Europe on hundreds of retail and manufacturing decision-makers in the digital commerce world and thousands of multi-channel shoppers revealed that 73% of consumers were more likely to visit a local store if the retailer provided their in-store product availability information online, while 39% stated that they were much less likely to visit local stores without the aforementioned online information. 

Research also shows that there was a 15% surge in mobile click-through rates when supported by OOH [3]. This was supported by another major piece of industry research conducted in 2015 which demonstrated that OOH activity drives a 17% increase in smartphone brand actions, and better performing OOH campaigns created a 38% uplift in short-term brand action taken via mobiles, with 66% of all actions being direct to the brand itself [4].

In essence, the takeaway is - Prime audiences offline, then retarget them online for the best campaign performance!

  1. Dynamic Creative Optimization

LI has enabled the integration of DOOH with machine learning to track consumer behavior and traits, as well as weather and traffic data in real-time to serve relevant content and creatives at optimal times. For instance, advertising a new cold beverage item during the summer only when it reaches certain temperatures can increase your audience’s susceptibility to purchasing your products, therefore increasing conversion rate and sales while simultaneously reducing ad spend. 

This was how Foodpanda used weather triggers to optimize creatives using weather triggers. A list of curated creatives was designed to standby, and to be played to suit the mood of the day, following weather triggers set up at the physical billboards.

The rapid advancement of technology has enabled a vast new world with endless possibilities for LI in OOH. OOH will continue to evolve and remain relevant in the modern era, and with the prospect of high ad exposure, engagement and conversion rates, it will be up to the marketers of our time to seize this golden opportunity. 

The Outernet Academy is a part of the Outernet Marketing Innovation Group a.k.a OMIG. OMIG is a group of elite brands from multiple industries that will put out their knowledge and best practices in Out-of-Home. To learn more, click here.

Related Articles:

  • Content 18: Types of data used in location intelligence
  • Content 19: Benefits and Challenges of using location Intelligence
  • Content 20: How is location intelligence applied in OOH campaigns today?

References

(1) Guttmann, A. (2021, June 2). Global OOH ad expenditure 2000-2022. Global OOH Ad Expenditure 2000-2022. https://www.statista.com/statistics/273716/global-outdoor-advertising-expenditure/.  

(2) Wolfe D., Moon G. (2008) Location Intelligence. In: Shekhar S., Xiong H. (eds) Encyclopedia of GIS. Springer, Boston, MA. https://doi.org/10.1007/978-0-387-35973-1_717

(3) Whyte, S. (2017, September 26). Mobile meets OOH is the sweet spot for location-based marketing. https://www.campaignlive.co.uk/article/mobile-meets-ooh-sweet-spot-location-based-marketing/1445624

(4) Outsmart (2016, April 26) The outperform study. https://www.outsmart.org.uk/news/outperform 

 

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