Contextual advertising only works once you factor in location

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Contextual advertising only really works once you factor in user location
Ben Tatton-Brown

Contextual advertising only really works once you factor in user location

Just as the birth of TV advertising facilitated the entry of brands into the living room, smartphones now provide a conduit for those same brands to literally get into the hands of billions of consumers all over the world.

Location will increasingly become the key factor in this evolution in 2016 and beyond. Turning advertising into smart, brand messaging platforms through the contextual understanding of users’ real-world lives, is the unique value proposition that pioneers in mobile location-aware DSPs like Blis, offer.

Location data has become ever more important because mobile is the platform that brands are increasingly turning to in order to drive consumer engagement. Research published by Blis last September found that 43 percent of UK consumers have clicked on a mobile advert, and we know that figure is only going to increase as people use more and different connected devices.

Location influences engagement

We looked closely at this relationship between location data and advertising by speaking to a wide cross-section of nationally represented UK consumers. By looking at how consumers use different connected devices, and how usage patterns change depending on their location, we can see the role location plays when engaging with advertising.

39 percent of consumers we spoke to said they were more likely to click on ads which took their location into account – showing just how important location is to creating relevant and contextually aware advertising. And at least 14 percent of the UK population is engaging with a brand as a direct result of location-based advertising over mobile devices.

That’s more than nine million consumers in the UK alone!

This contextual relevance is one of the elements that distinguishes mobile from other mediums. But it is the overall influence of location that truly separates mobile from all other channels in terms of how it informs our understanding of cross-device behaviour.

Buying audiences programmatically with behavioural location data

These insights are especially important when you consider the inexorable rise of programmatic advertising, which is forecast to take a £2 billion slice of UK advertising spend this year. Location is absolutely crucial to programmatic, as understanding consumers’ location is essential to understanding the context of when, where and how they will view an advert. And as we know, the better the contextual relevancy, the more likely a consumer is to engage.

The growth in programmatic is most striking on mobile, where eMarketer predicts that 75 percent of all advertising will be delivered programmatically by the end of 2016, with more than half the entire spend on programmatic display ads going on mobile devices.

Of course, existing programmatic advertising can already serve different ad campaigns to people depending on their device and location. But despite the wealth of different parameters and targeting options the rise of programmatic technology has given us, understanding the context behind people’s behaviour continues to be the missing piece of the puzzle.

Whilst programmatic technology has meant that the right creative can be matched to a particular app or web page and formatted for a specific device in milliseconds, this is a very binary process.

What makes it intelligent is building a bigger picture, using as much data as possible, and importantly, interpreting that data in the right way.

For example, it’s simple to serve an advert for a new car to a consumer based on a rough demographic profile, or because they may have clicked on a previous banner or keyed in a search term. But what if you could establish a customer’s Experian profile from their home ISP and then cross- reference that with the fact that they recently visited a BMW showroom and are a regular user of the Autotrader app?

Data soup

All these signals combine with other data to create a much richer understanding of a consumer’s motivations and habits, and a better understanding of how location will be the key factor in building this contextual picture.

Piece together enough data, and it can even become a powerful predictor of future behaviour. That’s why research firm Berg Insight sees location-aware advertising being one of the fastest growing areas, making up 39 percent of mobile advertising spend and 7 percent of all digital media spend by 2018.

Programmatic technology has also opened the door to creating campaigns that ‘understand’ that we are using more than one device every day, and that this usage is directly affected by our location. Our research found that whilst almost one-fifth of all smartphone-originated transactions took place whilst at home, 59 percent of these started on a mobile but were completed on another device. It has become more important than ever for advertisers to reach their target audience on multiple mobile devices, at home or at work, on the move and in real-world locations.

Two years from now more than half of Britons will own an iPad, Kindle Fire or similar tablet device – that’s on top of the 72 percent of the UK population who already own a smartphone. Beyond that, out of home (OOH) locations such as bus stops and tube station advertising are becoming connected and part of the programmatic landscape. An understanding of how individuals interact and experience advertising based on location, frequency, relevance and other behavioural queues, will become part of the digital advertising fabric. And by cross-referencing a consumer’s physical location with demographic data and browsing habits, advertisers can build a complex contextualised pictured that ultimately helps create clear signals of buying intent.

As programmatic platforms evolve they will enable personalised advertising experiences which will draw these insights together and automatically tailor the creative to the device, location and context. This will allow brands to create live, reactive campaigns that engage consumers in ‘mobile moments’ – ways that are far more like brand conversations than the interruption that so much advertising today still feels like.

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Ben Tatton-Brown is COO of Blis. He is a proven digital media executive and acclaimed entrepreneur with over 20 years experience across ad-tech, media and agency business. Ben co-founded and sold award winning mobile ad agency RingRing Media to ad-tech specialist Amobee and was part of the exec team that sold Amobee to SingTel for $321m in 2012.
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