Location more available but less accurate because of programmatic dilution.
Mobile ad platform Thinknear’s latest location accuracy report contains a variety of findings about the impact of location accuracy on consumer behavior and ad performance. Overall, the report says that the availability of location for mobile display campaigns is expanding but geo-accuracy is being diluted or degraded by a new influx of programmatic impressions.
Thinknear reported a 7 percent decrease in location accuracy from Q3 to Q4 in 2014. The company offered an explanation in its report:
Based on our analysis, most of the decrease in the industry Location Score is attributable to apps that are new to the programmatic ecosystem. Anecdotally, this indicates that developers are either not placing an emphasis on “getting data right” or are playing “fast and loose” with location data to capture higher monetization rates. Additionally, we noted a marked increase in the volume of mobile web traffic entering the programmatic space (as opposed to mobile app traffic). Mobile web has traditionally had lower-quality location data, which is impacting the industry as well.
Part of the report is devoted to a test of “the impact of high-quality location data on mobile campaigns.” The company ran 27 test campaigns in a number of categories consisting of “several million impressions”: automotive, entertainment, retail, food & drink.
Thinknear found that more accurate location targeting resulted in a substantial boost to CTR. However an earlier study from xAd cast doubt on the value of CTR as a campaign metric for mobile display advertising.
More significantly, Thinknear also measured the impact of accurate location on conversions driven by mobile display ads. In some categories there was a more than 2X improvement in “conversion lift” from using more accurate location as part of ad targeting.
What constitutes a “conversion” isn’t specifically defined in the report so there may have been several metrics lumped together under that heading (form fills, online transactions, offline transactions). However the data from Thinknear confirm what other studies have shown: campaigns involving location consistently outperform campaigns without location targeting or locally relevant ad creative.