Location Data Use & Misuse; How Marketers Must Approach Mobile Sentient Consumers

mobile sentient being backlashLocation data and location-aware sensors. At one level, it’s the information that equips marketers to deliver the contextually relevant marketing and advertising people find convenient and valuable. At another, it’s a technique that (if wielded improperly)  can move consumers to distrust the mobile channel and shut the door to the mobile advertising and apps it delivers. Joy Liuzzo tracks recent events and warns marketers that they are only experiencing the calm before a storm that could blow their businesses out of the water.

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Talk to leaders in the mobile industry nowadays and you’d think they were all real estate agents with all their talk about ‘location, location, location.’  Granted, the ability to passively track a person’s movements over time, deliver a highly relevant message and drive them to take action (the old ‘get-a-coupon-when-you-walk-past-Starbucks’ scenario) has enamored marketers for years.  With the state of California announcing that they will be issuing guidelines to app developers about privacy, and with mobile advertising companies banding together to figure out an alternative to the UDID (unique device identifier) to track mobile ads,  the public is slowing becoming aware of the issues and the honeymoon period of mobile data collection is coming to an end.

I’ve been a data dork for longer than I want to admit and completely understand the excitement around location information.  We’re able to take information on what people are doing with their device, overlay where they are when they are engaged on their device, and turn it into a marketing/targeting dream come true.  It’s enough to make the researcher in me do a dubstep inspired wiggle dance.  But then the side of me that lives in the world outside of the Mobile and Advertising Industry, the one that advocates for people to be treated with respect and integrity, thinks through the impact on every single one of us, and the admiration for this approach is gone.

Command-control

Back in 2007, IBM released a report titled The End of Advertising as We Know it (PDF link) and predicted that four scenarios will emerge in 2012.   They were spot on with their Consumer Choice prediction that foresaw the day consumers would assert their control over intrusive ads, forcing the evolution of formats that put people in the driver’s seat.

We time-shift our TV viewing so we can fast forward through commercials; we run cookie-deleting programs on our PCs to foil the behavioral targeting companies; and we are taking steps to be less reachable by advertisers, challenging them to deliver us advertising we will appreciate and accept.

Sure, people understand advertising is a trade-off. They do have to accept a certain level of advertising in order to get the content and information they want about products and services they are genuinely interested in. But they are prepared to draw the line and start fighting fight back against the more aggressive and intrusive approaches.

Against this backdrop, mobile phones and tablets are poised to be the next battlefield. These are fiercely personal devices capable of delivering relevant and engaging advertising. So far many companies have played by the rules, and, because of this, ads have been perceived more favorably. And why not? The advertising was effective, not intrusive, and everyone won. People trusted that they were in control of the advertising they consumed and the personal information they shared in the process.

This was a boon to the ad networks, publishers, app developers, and everyone else in mobile. People were sharing data, mobile ads became some of the most relevant inventory available, and formats evolved to take advantage of the influx of data. Big data grew and so did mobile advertising as an industry. It was a happy time until the last months when news of abuses (see FTC report on Mobile Apps for Kids; Class-Action Privacy lawsuit against Path and others; and the great Carrier IQ exposure) revealed the darker side of data collection.

Since we didn’t stop the party, people have decided to take the initiative. It’s no surprise that we’re seeing more and more people becoming what I call Mobile Sentient, aware of precisely how public their private device and behavior has become and the extent to which third-parties have visibility into it.

As the population of Mobile Sentient Beings (MSBs) increases (and believe me it will!), so do that chances that mobile —the only channel that is personal and capable of supporting deep interactions and conversations with people and the brands they love—will lose its luster. Specifically, location-based services that consumers are open to now (TNS Mobile Life Study) — services that first whet consumer’s appetites for hyper-relevant advertising including special offers, mobile coupons and perks associated with check-ins and loyalty programs — will lose consumer trust.

Education, education, education

I know from my interactions with companies and execs that the vast majority of players in the mobile space are trying to establish guidelines. But, in the absence of clear rules, many have been using their own moral compass to determine what is acceptable (some less morally than others, by the way).  It’s a hard truth ­ — and one that should inspire us all to take action now — not later — and spearhead the efforts that will win us lasting and real consumer trust.

How can we head off this disaster?

  1. Be honest with your audience and tell them what to expect.  If you are going to be serving them ads based on their location and browsing habits, let them know.  The worst that can happen is that they stop visiting, but that’s something you are facing anyway with MSBs.
  2. Develop clear, simple and easy to understand Data-Sharing policies — and call them that! (After all, it’s a term consumers understand. What does ‘privacy’ mean anyway?)
  3. Experiment and work to identify the data you should be collecting and ignore the rest.  All data is not created equal, and your models will tell you what is most important.  As a bonus, your IT team may send you a fruit basket as a thank-you.

The final thing I want to encourage is an industry-wide, proactive education campaign for real people.  If we get out there now with the story we want to tell (how contextually relevant, location-aware advertising can make people’s lives easier and save them time, for example), we can make sure the population of MSBs are educated about our intentions and in control of the situation.  If we wait until there is another media blast about a shady company using location-based data inappropriately, we’re going to be too late.

 

 

 

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