What is Location Based Advertising (LBA)
LBA acts as a reminder whether you want to purchase anything from a store while crossing by it, based on your previous purchases and interests.
Location-based advertising (LBA), in very simple words, is a BILLBOARD in your mobile. LBA is not new, while travelling we often encounter a board saying Restaurant this way or 5Km away. So with the proliferation of smartphones and GPS, companies are able to contact customers with the right content at the right place and time.
On the way, you might get messages regarding any sale, discount or a simple advertisement of café or mall nearby. It may also be termed as mobile marketing or mobile advertising, in which you get geographically targeted messages where you are most likely to make a purchase.
These personalized messages also act as a reminder for you, in case, you missed something from your list.
Let's elaborate the concept of LBA from a marketers point of view
Concept of Location Based Advertising
Since the main aim of the advertisement is to attract buyers, m-marketing is the easiest way to add customers to a shop while he is on the go. No matter how busy a person is, if your favourite thing is available nearby, he will try to give it a chance.
According to a study published in 'International Journal of Mobile Communication', by Jengchung V.Chen: “attitude of the consumer towards a brand depends on attitude towards LBA which in turn involves factors like Format, type of product, involvement, privacy and brand credibility of the advertisement'.
Some of the common challenges for advertisers are small screen size, limited bandwidth, slow data and connectivity, which will overcome with the ever-improving technologies as always.
Being a customer, unplanned buying during off-peak hours could make you regret later, or vice versa, you'll end up with a profitable purchase.
For a customer, it could be sometimes irritating to get messages and loading the inboxes while on the way. Ignorance is a bliss in this case. Maybe you could also get your favourite stuff on the road which you were looking for.
Getting permission before sending someone a mobile message is now a legal requirement in Europe (EC 2002).
Since LBA could keep an eye on your previous purchases and hence identify your lifestyle and behaviour, it could also be a privacy concern for many.
According to Shubhankar Dhar, Saint Jose Stae University - “The user privacy will be improved by an anonymous version of some location-based services which may be able to “clock” the users' locations or decrease the locational accuracy to essentially “hide” the users with higher privacy need."