This is part one of a two part series on location services. In these articles, we will consider both consumer focused location based services (LBS) and enterprise geolocation services
Today’s mobile devices, be they smart phones or tablets such as the IPad, are all equipped with GPS. Meaning the current location of a mobile user can be tracked. This has created a location based services frenzy. Highly publicized in the media, and well funded; a new wave of companies are appearing. Let’s look at this market in more detail.
The Location Based Services (LBS) Sector
What is LBS? From Wikipedia:
“A location-based service (LBS) is an information or entertainment service, accessible with mobile devices through the mobile network and utilizing the ability to make use of the geographical position of the mobile device”
Marketing and advertising companies see new opportunities to engage with users directly and influence purchasing behavior. This engagement can be targeted (suggesting only products of interest), influenced by others in your social network, and most importantly can potentially occur while consumers are near a point of sale. New products and companies are appearing almost daily in the LBS marketing space. Let’s break down this market and describe some of these companies:
- Collaboration/Recommendation/Local data
Local data is a hugely important potential area of revenue. Though shopping online has grown, still a large proportion of consumer spending is focused on the local market. Influencing that behavior has seen much attention. Yelp is a popular application which allows users to find and comment on local business. For example, find all Mexican restaurants within 1 mile of my current location, and indicate their grade based on user recommendations. Bizzy, is new application which shows where your friends have dined lately and offers their recommendations. - Bargain Shopping
Everybody likes a deal; sales, discounts, coupons. Increasingly consumers are looking to avoid paying full price. A range of companies have appeared, targeting bargain shopping.- Loyalty – The manual check in is an important part the loyalty based applications. Consumers are rewarded for regular check ins. These reward include site recognition – badges, status as Mayor etc – and discounts. Key players in this space are Facebook Deals, Foursquare and Gowalla
- Coupons – Groupon, LivingSocial, Savings.com have become very popular online coupon focused sites. Groupon alone is now valued at around $25b! LivingSocial, which just landed $400 million in venture capital, is expecting to see $1 billion in revenues this year. Savings.com is taking a targeted approach to coupons. Looking to personalize offers, they deliver deals based on a shopper’s stated unique interests and needs. The site itself gets a percentage of the sale without having to actually process the transaction.
Facebook Deals is about to enter this space, and could have a big impact. Daily aggregators have become increasingly popular. These are sites which comb the Web for offerings, gather local deals, and aim to simplify deal overload for customers. Among the aggregation sites is Offers.com, a 2-year-old company that was already offering coupons, deals, and offers, and is now expanding into the local space with the debut of Local City Deals.
Many of the companies in the coupons space are now partnering with location service companies. Checking in to your favorite grocery store is now linked with store coupons.
- Social Networking and Location
Facebook has the world’s largest single collection of consumer data. Many new companies are leveraging the Facebook data for their own location marketing efforts. Facebook strategy is slowly evolving in this space. This may be a threat longer term to these new ventures. Already we have Facebook Places, and Facebook Deals and it is thought Facebook will announce partnerships with smaller, local deals companies including ReachLocal, Tippr and Gilt City. Google have been slow in entering the location and social marketing sector. Many suggest they are scrambling to have a presence. A recent article in Mashable by Matthew Ingram mentions that Google employees annual bonuses are tied to the success of Google’s social efforts. It will be interesting to see how much Google will impact this sector over time.
GeoLocation Services
Location based services are receiving the lions share of media attention at present. The term is synonymous with location marketing. But the locations based sector is far bigger than this relatively new area of focus. Mobile and geolocation have created buzz and a slew of new companies and applications. A number of the established location focused companies are turning their attention to geolocation services. Many argue that the likes of ESRI should be at the forefront of these new developments. But like the search and social networking giants, these so called geospatial companies, have been slow to step up. The terminology has become confusing, but unlike location based services (LBS), geolocation services are focused on the enterprise. So the transformation of companies and not just consumer habits. Let’s look at some examples of these services:
- Routing
Route4Me is a Web and mobile app which allows users to plan optimal routes with up to ten stops. - Tracking People and Things
Ekahau works across small and large geographies, from within a hospital to across a whole continent. It allows the tracking of people and objects. So for example, locating medical equipment. - File Sharing Based on Proximity
The LoKast application from Nearverse allows file sharing based on location. So workers sharing files in a meeting and adding media to conference rooms or other spaces. The company hopes to broaden its application to more general ad-hoc geo-fencing. - Geofencing
LOC-AID enable developers to use carrier location information for precise geolocation. They have partnered with cell carriers, and use an opt in model. With a users agreement their location data is transmitted to the carriers. This has considerable potential, geofencing being one area of current company focus. - GeoLocation Service Tools and Data
OpenGeo are an open source project which aim to help developers build geolocation services. The companies founder, Matt Galligan, says; “Location-based devices only provide a latitude and a longitude, sometimes an altitude. What they don’t provide is a ZIP Code, city, state, county, weather data, messages and photos posted near the site. They don’t provide business listings, Wikipedia entries, census data (for demographics), articles written or posted near the location. All of which SimpleGeo does” - Field Service
These are tools to help field workers such as HVAC technician and equipment repair people. Location services can provide optimal call routes, log arrival and departure times, connect other techs in the same vicinity, and provide customers with more accurate schedules.
Summary
The popularity of mobile devices has created considerable opportunities in the location based sector. In the first article we have provided some background to the services currently in place. This is a vibrant and rapidly changing space. In the second article we will look ahead and explore some of the many potential future opportunities.
Related Resources
- Location Based Service (LBS) Defined
- Location Based Service (LBS) in the Economist
- Google’s Push in the Location and Social Marketing sector
- ESRI and Location Based Services
- Geolocation and Field Services
WebMapSolution build Web and mobile mapping and location based applicationsFor more, see http://www.webmapsolutions.com