Location-based marketing considered intrusive by majority of consumers

10th Dec 2013

Imagine walking past a shop on your way to work. You get a text, it’s from a well-known retail store that you notice is one that you walk past every day. In fact, you just walked past it. What an excellent piece of location-based marketing you may think, before making a mental note to go back at lunch to take advantage of the two-for-one deal that was just texted to you.

Unfortunately, not everyone works in marketing, or retail and the response to this type of marketing varies wildly. A new study by non-for-profit global IT firm ISACA has highlighted this and is warning that the general public may not find this activity quite so excellent. In fact, they may well decide it’s invasive.

The research was conducted across four different countries – the UK, US, Mexico and India, and was compiled into a report titled IT Risk/Reward Barometer . It covered 4,000 consumers’ holiday shopping habits and opinions of privacy.

In the UK, and India, that potential customer walking down the street may actually be concerned that it wasn’t just them that noticed the store, but that this building made out of bricks and metal noticed them too.

It may sound alarmist, but the 70% of respondents in these countries that questioned the methods of these location-based marketing tactics have shown they’re not an audience to be ignored.

For those retailers looking to get involved, or that already carry out these activities, fully knowing the location in location-based marketing looks to be the key.

Offline or online: which is more invasive?

For example, in Mexico there is a short, but still significant drop in those that would find SMS-based location marketing with 40% saying they would not find it invasive.

But notably, their attitudes to online marketing is more reserved. Mexico was the only country to find online recommendations based on browsing history or recent purchases more invasive than offline location-based techniques. US and UK consumers, conversely, cite being marketed online as the preference.

Ramsés Gallego, international vice president of ISACA applauded the innovative applications that assist in brand marketing, but warns them to be aware of how different audiences perceive privacy invasion.

“It would be wise for brands to heed consumers' feelings about the invasion of privacy,” he said. “Or at least provide transparency about the information they are collecting and how it will be used.”

John Pironti, risk advisor at ISACA followed up on Gallego’s comments and said that despite the willingness to share information online by consumers, personal privacy is still hugely important to them.

He concludes: “Retailers that use technology to try to save shoppers time and money without asking permission first may actually do more harm than help to their bottom line this holiday season.”

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