Location Analytics: We're Warning You to Pay Attention

More than 95 percent of the 500 largest retailers know the answer to the first question but most companies are quotflying blindquot about how to answer the second question according to quotHow Location Analytics Will Transform Retailquot a March 2014 article in the Harvard Business ReviewA relatively new field called location analytics quotbrings the power of web analytics to the analog world enabling firms to continuously capture location data on customers in physical venues at an unprecedented scale and focusquot says Forrester Research quot Basically location analytics companies track people via their mobile devices in exchange for financial inducements such as gift cards and coupons and then sell the information they have gathered to companies that are interested in finding out how customers are shopping The information can induce companies to change their stores in much the same way that they change their websites based on information they have gathered about their customers39 online behavior The number of Americans with smartphones who use mobile coupons quadrupled to 295 million in 2013 amp8211 truly a goldmine if retailers can pinpoint customers most likely to respond to special offers as they walk in the doors The potential goldmine of location analytics is now uniting technology companies and investorsA survey by Pew Research Center39s Internet Project is another piece of evidence that location analytics companies like Placed Single Touch RetailNext Euclid Analytics Locately and Swarm could have a bright future The survey showed that social media users were more than twice as likely to identify where they were posting from in 2013 than 2011 and 74 percent of adults who used smartphones used their phones39 locationbased services quotTaken together these trends show the ascent of location awareness and the role it might play in the life of users amp8211 and the technology companies that are scrambling to provide more alertstyle applications that tell people who and what is near themquot says Pew39s quotLocationBased Servicesquot reportMarketsandMarkets a Dallasbased market research company forecasts that the locationbased services market which includes the kind of tracking services that Placed and its competitors provide will grow from 812 billion in 2014 to 3987 billion in 2019 The report specifically cites the growing number of smartphones users as a reason for its optimistic projection about the market quotAlready the scale of data collected by early adopters of this technology is staggeringquot says the Harvard Business Review article quotLocation analytics firm RetailNext currently tracks more than 500 million shoppers per year by collecting data from more than 65000 sensors installed in thousands of retail stores A single customer visit alone can result over 10000 unique data points not including the data gathered at the point of salequotMost relevant to media companies and agencies is that the emerging use of location analytics will increasingly inform media planning and buying Once retailers and manufacturers have advanced insights on consumer activation and are able to connect the mobile device to instore activity and the retail decisionmaking process it will be a short step to connecting all advertising exposures amp8211 and especially mobile and placebased media advertising amp8211 to the actual purchase While this is the silver bullet of marketing location analytics is bringing it closer to realityPLACED Seattlebased Placed was founded just three years ago and has announced it had received Series B funding of 10 million from Two Sigma Ventures and Madrona Venture Group In its June 10 2014 press release Two Sigma Managing Director David Joerg said his company invested in Placed because the information it gets from the 175000 people it tracks quotyields a depth of insight nobody else can offerquot and Placed has quotbecome the standard for location intelligencequot Yet RetailNext tracks more than 500 million people and Single Touch System Inc39s locationbased mobile app has 400 million consumers delivers about 1 million messages daily to mobile phones and has more than 60 million unique users Placed has the advantage of having quotagreementsquot with its 175000 users Placed39s current clients include AdTheorent InMobi Millenial Media Pandora PayPal Rocket Fuel The Weather Channel Thinknear Undertone Verve and xAd The fact that no retailers are listed among its clients certainly calls into question the viability of the business but the company appears to recognize the relevance of its data for media sales purposesThe Harvard Business Review article identifies Euclid Analytics and Locately as other location analytics companies and reports that quotmultiple location analytics firms are tracking customers at hundreds of new venues each monthquot Euclid is tracking 6 billion visits by customers to thousands of locations every day quotBillionquot is not a typo In its article 10 Tech Tools to Boost Your Bottom Linequot Business News Daily identifies RetailNext and Swarm Portal as two location analytics companies that quotcan show you the number of customers who came into your store conversion rates and other important information that will help you make strategic educated decisions about your businessquotEUCLID ANALYTICS The San Franciscobased company says on its website that its technology measures instore visits engagement and loyalty easier and faster than any other technology Euclid reports that its technology quotsensesquot smartphones39 anonymous WiFi signals captures and analyzes those signals and delivers its reports on its analysis to its clients via email Euclid39s website lists its technology partners but not its financial or investment partnersLOCATELY LOCATION ANALYTICS The Bostonbased company lists an article on its website that reports it received a 500000 grant from the National Science Foundation that would help it collect and analyze GPS data but there is no information about private companies39 investments The Harvard Business Review article compares Locately to Placed saying both companies quotuse optin apps on customer devices to track everywhere customers go 247RETAILNEXT INC The San Josebased company claims on its website that in 2007 it pioneered the use of retail instore analytics There isn39t any information about investors on its website but there is plenty of information on the company39s clients which include Bloomingdales Family Dollar Frito Lay PampampG PepsiCo and Verizon Wireless as well as endorsements by those clientsSINGLE TOUCH SYSTEMS INC The Jersey City NJbased company delivers information on the shopping habits of people who use mobile apps to several prominent companies including CBS Hertz MTV RadioShack WalMart and 3M Company These clients have helped the company39s annual revenues soar from less than 1 million in fiscal year 2010 to 8 million in fiscal year 2013SWARM SOLUTIONS INC Several of Swarm39s clients endorse the company with one praising Swarm39s visitor conversion tracking and closed loop marketing and another praising Swarm39s commitment to measuring offline foot traffic as well as online trafficIf you are receiving this report you are a registered member to MyersBizNet or are receiving it as part of a registered corporate membership As a member Jack responds personally to your emails requests and comments He is available to speak at your company events In addition to MyersBizNet Media Business Reports your membership underwrites MediaBizBloggerscom Women in Media Mentoring Initiative MyersBizNet Economic Media Business Report MyersBizNet Video Media Report plus our exclusive industry economic forecasts trend forecasts and corporate performance research Redistribution in any form except among approved individuals within your company is prohibited As a member you have full access to all archives and reports at wwwjackmyerscom If you require your ID and password contact 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Location Analytics: We're Warning You to Pay Attention

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