The debate about companies’ use of location data has gained a lot of traction this year. However, that shouldn’t make you shy about using it. In the right hands, used the right way, location data is an invaluable tool in any market.
Your competition knows this, and the debate isn’t slowing them down, either. According to a recent BIA/Kelsey study, companies spent more than $17.1 billion on location-specific mobile marketing just last year. The study predicts that figure will jump to about $38.7 billion by 2022.
That’s because business leaders realize the debate isn’t about whether collecting location data is worth the effort. It’s obvious that such data is essential if you want to optimize local or global marketing efforts. However, seeing success from using this data means knowing how best to allay concerns about the safety of consumers’ data once it’s in your hands.
Planning Your Approach Wisely
People have been worrying about the safety of their personal data for several years now. And when they learned that Cambridge Analytica was secretly mining data from 87 million Facebook profiles, that worry grew into genuine fear.
Earlier this year, the European Union took a significant step in addressing privacy concerns by passing a set of data-handling rules known collectively as the General Data Protection Regulation. The rules strongly regulate how companies collect and use personal data — including location data — within any EU country, and they place hefty fines on each violation.
Though the regulations are focused on EU countries, they affect any company wishing to be visible to customers living in the EU. As more companies make their way into globalized markets, more of them will expand their marketing efforts into Europe and around the world. All of them will have to take GDPR into consideration.
And as long as globalization exists, location data will be essential for any brand looking to expand its reach. As Lathan Fritz, founder of global marketing agency Amerisales,told Forbes: “Globalization has made it so there aren’t really any ‘cookie-cutter’ ways to offer products or services anymore.” Location data offers brands opportunities for personalization and context-aware marketing that are essential for standing apart from the competition.
So geotargeting with location-specific data is the name of the game. However, you can only make use of that data if your customers are OK with you collecting it. You may not be required to adhere to the GDPR yet, but you’re wise to start implementing the new law’s requirements now — it’s only a matter of time until the rules are updated for you as well. To make sure your efforts don’t get you into trouble, handle every piece of location and other personal data you collect with these three principles in mind:
1. Treat data as a privilege only your customers can grant.
When it comes to geotargeting — employing a user’s geographic location to determine which advertisements to show — some efforts have failed because they simply missed the mark when it came to applying this principle. For example, when Philadelphia law firms started targeting personal injury ads to patients who visited emergency rooms, they came off as nothing more than digital ambulance chasers. Other efforts failed because consumers didn’t specifically opt in for location marketing. The fact that their data was being used in this way seemed like a violation of privacy.
The data you collect belongs to the consumers you’re collecting it from. Allowing you to collect and use it is a privilege they grant to you. Show your appreciation by expressly asking users to opt in and allow you access to their location data — and by giving them options to opt out easily. When consumers choose to share their data with you and feel secure that they control that access, they’ll be more accepting of geotargeted ads.
2. Be just as transparent as you’re asking customers to be.
If you’re utilizing an app for your product or service, specify any third parties with whom you share data and why you share it. For example, if your marketing strategy includes social media integration, clearly state that a consumer’s location data may be shared with social media platforms for that purpose. And remember to provide all of this information in a way that consumers can easily understand and digest. Not just whether, but how, you present this information is key to being transparent with consumers.
3. Explain how location data improves a customer’s overall experience.
While handling consumers’ location data with care and being transparent about how you use it, remember to educate them about why this data is important for you to collect in the first place. They may not care much about how it helps your brand identify new markets. Yet they’ll likely be pleased to know that you use their data to improve their and other consumers’ experiences and to innovate new products to improve their lives.
A McKinsey & Co. study found that seeing the benefits of sharing location data helps consumers feel much more comfortable about allowing it. In the study, more than 55 percent of participants would feel comfortable sharing location data from their connected automobiles if it meant receiving perks such as personalized restaurant recommendations or discounts based on their current location.
While others can debate the pros and cons of collecting location data, successful brands have already decided. The only question now is how to make it clear to consumers that their data is not only safe in your hands, but also a huge asset in creating better experiences for them.