The Location Data Market Must Trade On Clarity, Not Confusion

"Data-Driven Thinkingis written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Michael Hayes, chief marketing officer and chief revenue officer at UberMedia.

Although location data and location-based advertising are by no means new sectors, they’re far from mature when it comes to providing transparency and accountability for their claims.

Location data providers currently operate in a climate of unsubstantiated claims, where the veracity and accuracy of location data is up to the word of the provider. That doesn’t necessarily mean such claims are inaccurate.

But within the growing location data industry, we’re still asking marketers to accept too much at face value.

What change looks like

With no reliable third-party verification layer for location accuracy, it is incumbent upon the location data industry to answer the call for transparency. Location data providers must practice ethical data stewardship and help marketers understand precisely how they’re recognizing real-world visits and base-lining foot traffic and their methodology behind incremental lift. Otherwise, the money stops flowing and advertisers lose out on a valuable tool to better understand the behavior of their customers and prospects.

To establish trust and ensure continued robust growth in location data and the location-based advertising and attribution sector, a coordinated industry effort will be required.

To start, the location data industry needs to align with consistent definitions of terms among suppliers. Elsewhere in the industry, no one disputes the definition of an impression or a click. But in the location space, for example, it’s hard to pinpoint a standardized definition of “first-party data” or “always-on location data.” It becomes difficult to compare offerings when there’s a lot of smoke in the room around simple terms.

Second, the establishment of an affordable third-party accreditation for location data collection practices, data cleansing, base-lining, visit counting and attribution methods seems especially prudent. Total transparency around these practices provides validity of the data and the trustworthiness of a provider’s method. The Media Rating Council and the Location Search Association have both done good work in this area. But like any industry bodies, the level of urgency with which they pursue and refine such initiatives reflects the urgency voiced by the buy side.

Finally, we need more thoughtful education and understanding of incremental lift driven by ad campaigns. Incremental lift is an incredibly valuable metric, but it is also nuanced and can be redefined on a case-by-case basis. With location-based advertising, it’s not uncommon to see no foot traffic lift from a CPG ad campaign intended to drive visits to Walmart, but that doesn’t necessarily mean the campaign was a failure.

Long-term impacts

Furthermore, there is value to the location-targeted messaging beyond near-term incremental foot traffic. A campaign could have succeeded against overall KPIs like brand lift and resulted in foot traffic months later, well beyond the campaign’s attribution window. Given their bespoke nature, the industry needs greater transparency for these attribution models to foster better trust in the tactics and technology.

It’s time for location data and attribution providers to demonstrate that they’re worthy of the trust that advertisers place in them. The sector simply cannot afford to operate in a landscape of black boxes and mystery meat. It’s time for location-based marketing to heed the calls for transparency within the digital industry and start trading on clarity, not confusion.

Follow UberMedia (@UberMedia) and AdExchanger (@adexchanger) on Twitter.

2 Comments

  1. FYI - NinthDecimal location accuracy was validated by comScore a couple weeks ago. Aside from that, I completely agree on having universal terms defined, specifically as it related to incrementality. Lastly, the CPG-Walmart scenario is a poor example as foot traffic lift for any CPG product sold at Walmart can't reasonably attributed to the exposure of a single product sold at Walmart.

    Reply
  2. There are some very valid points in this great article by Michael and it’s encouraging to hear a location-based advertising provider talk about transparency and accountability.

    There are some brilliant companies doing some great things in location, but there is also far more suspect behaviour than we believe should be present in an industry as mature and valuable as location-based advertising. The best players should welcome verification and not fear it, as it helps build a robust and trusted marketplace.

    I agree with Michael’s assertion that consistent industry definitions would help and this is a common concern with all types of measurement and attribution. Equally, I think the industry needs to be more transparent in the methodologies they employ to deploy location-based advertising. Anyone who has spent any time in the industry will know there are vast differences in quality and accuracy of IP based targeting vs genuine, authenticated GPS data and significant limitations when relying on bidstream data for accurate targeting.

    Like brand safety, fraud and viewability before it, location-data will be the next area of digital advertising that will require independent verification.

    Reply

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