by Gladys Kong

Marketers deserve mobile location data transparency, not smoke and mirrors

Jan 22, 2018
MarketingMobileSmall and Medium Business

The mobile location data sector is young enough that we still can establish standards and best practices around data quality and transparency.

rear view mirror with desert scene in the distance
Credit: Thinkstock

Today’s savvy marketers are investing more and more in mobile location data. They are working with providers of data and insights, campaign measurement services and ad attribution reports to understand where consumers travel along the consumer journey and how advertising affects consumer interactions with bricks-and-mortar businesses. They’re becoming increasingly reliant on insights gleaned from mobile location data to measure marketing ROI and even decide where to build new business locations.

In other words, marketers are using location data to make extremely important decisions every day.

In “Why 2018 will be the year of mobile data measurement and insights,” I suggested a few reasons for the growth in marketer interest in location-based measurement related data and services. I pointed to the increased use of omnichannel campaigns which demand measurement services that connect consumer interactions to trackable, reportable measurement data and Key Performance Indicators. And I proposed that the trend towards automated, programmatic advertising has compelled media agencies to invest in location-based insights to show brand clients innovative services and value.

Last year, BIA/Kelsey’s Mobile Ad Revenue Forecast reported that the location-targeted portion of overall mobile ad spending was projected to grow from $12.4 billion in 2016 to $32.4 billion in 2021. That location-targeted ad spend accounted for 38% of overall mobile ad revenues in 2016, and would grow to account for 45% by 2021, the company said.

Opaque data

As marketers increase reliance on mobile location data, I believe data quality and transparency are crucial. The fact is, in many cases marketers are informing choices that could make or break their businesses based on an opaque black box of data.

But that doesn’t mean they have complete trust in it. In 2017, research from Carto and Hanover Research via eMarketer showed that nearly half – 47% — of C-level executives in the U.S. said ensuring data quality and accuracy was a challenge. Even determining where it came from was a difficult task: 38% said it was a challenge to identify the source of data.

When it comes to using data to determine where best to set up additional business locations such as stores or restaurants, Deloitte put it bluntly in a 2017 report about using data for business site selection, noting that “entrusting location decisions to an uninformed mix of data is perilous.”

Even the Mobile Marketing Association has acknowledged the location data problem. After establishing a Mobile Location Data Accuracy Group in 2014, the organization in 2015 pointed to a “Lack of accuracy standards and market education.” While the MMA released location based advertising measurement guidelines last year, some of the most sophisticated marketers still struggle to fully discern the nuances of what the data and reports they rely on actually represent.

Not only should marketers understand how the mobile location data their vendors provide is derived, they deserve to be armed with the knowledge and confidence to ask the right questions when evaluating measurement providers. Yet, while some in the industry push for location data transparency, if data buyers aren’t asking their data providers probing questions, they may be settling for a false sense of clarity.

Think about the other things people research in their everyday lives. They inspect food labels to ensure products are made from quality ingredients. They compare vehicle safety ratings to evaluate their next SUV purchase. So why shouldn’t they know more about the location data that went into producing their campaign reports?

Showing marketers what’s under the hood

Companies like mine have our signature methods of weeding out bad data, ensuring that the information our clients rely on, whether it be to target advertising to niche audiences, measure restaurant visits, or determine their next retail location, is just that – reliable and valid. When our clients want to look under the hood to learn more, we show them.

And yes, even though marketers are allocating more budget towards location data and location-based measurement services, confusion persists. While mobile location data is a complex subject, marketers should be made aware of more than just hyped-up numbers reflecting the volume of data their providers have. For instance, their providers should be willing to tell them what portion of mobile location data is derived from each source, how vendor systems account for fraudulent or misleading location data, and which methods providers employ for calculating metrics such as exposed visits.

Just look to the broader digital advertising industry as a harbinger. Ad fraud and a lack of transparency has tainted the digital ad ecosystem, corrupting trust between advertisers, media firms and technology providers. Things got out of hand before one very powerful brand – P&G – forced the industry to be more transparent. The mobile location data sector is young enough that we still can establish standards and best practices around data quality and transparency.

Others in the location data space have called for transparency. Now is the time for data providers to put that desire into action by educating clients and giving them honest answers, not smoke and mirrors.