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© 2010 Forrester Research, Inc. Reproduction Prohibited1

The (Potential) Location-Based Services Revolution

Melissa Parrish, Analyst

© 2010 Forrester Research, Inc. Reproduction Prohibited2 © 2009 Forrester Research, Inc. Reproduction Prohibited

Melissa Parrish, Analyst

@melissarparrish

September 14, 2010

Three categories of location-based services

Growth indicators

Recommendations

Agenda


Recommendations

What it means

Philip has a lunch date


This is NOT the LBS landscape

� Overwhelming and intrusive advertising

� Constant "shouting" of messages

� No opt-in, no opt-out

� Misuse of private information

But it illustrates some of what drives consumers’ fears about location-

based services and technology


Marketers are interested in 3

LBS categories: mapping &

search, shopping, and social


search, shopping, and social

Mapping, Navigation & Search


� Overall, 13% of online cell phone owners look up

directions or maps at least monthly

� Among online smart-phone owners, this number

increases to 50%

� Among smart-phone owners, 31% have used an

Mapping mobile adoption


� Among smart-phone owners, 31% have used an

application for maps within the past three months.

Internet is preferred local search method across generations


Top 3 search topics include “Local”


Mobile Search Users % Of Mobile Internet Users

Mobile Search Usage Is Growing


Source: Forrester Research Mobile Advertising Forecast, 2010-2015 (US)

Mapping, navigation & search takeaways

� Extension of a long-standing, non-digital consumer behavior

� May or may not be mobile-based

� Already part of SEM mix for many marketers

� Consumer adoption linked to increased access to more powerful hardware


� Forrester expects 74% of mobile internet users to perform 13 mobile

searches per month by 2015

Shopping

ShopAlerts


28% of mobile online users are interested in some form of discounts or promotions


Only 3% have requested a

mobile coupon, and only

another 3% have used one


another 3% have used one

Improved discoverability & convenience will drive adoption


Social


Tons of buzz, but not tons of users…..yet


But those who do use LBSN are highly influential


Young, well-educated males use LBSNs


And they use other LBS more than other consumers too


Advice for marketers

� Companies with a culture and budget that supports experimentation should start

testing now

� Others should jump in when scale matches business objectives

� Explore all LBSNs

� Create incentives for new customers

� Offer discounts and coupons

� Reward loyal customers


� Reward loyal customers


Growth indicators

Recommendations

Agenda


Recommendations

What it means

Mobile is becoming

increasingly important and

marketers are taking notice


marketers are taking notice

Mobile Internet Users (1x/mo)% Mobile Internet UsersUsing Internet-Centric Phones

Mobile Internet and Internet-Centric Phone Usage Is Growing


Source: Forrester Research Mobile Advertising Forecast, 2010-2015 (US)

Mobile marketing is growing, too



Growth indicators

Recommendations

Agenda


Recommendations

What it means

How can you ensure the growth

of collaboration between

services and marketers?


services and marketers?

Address users’ needs

� Allay privacy concerns

� Integrate marketers in a way that presents their messages and offerings

as true service

� Think about utility in addition to convenience


Consider the marketers’ perspective

� Majority look for scale

� Case studies help close the deal

� Help educate them about how it fits into the marketing mix



Growth indicators

Recommendations

Agenda


Recommendations

What it means

Imagine Philip’s lunch date again, but this time…


Thank you

Melissa Parrish

+1 212.857.0784

© 2009 Forrester Research, Inc. Reproduction Prohibited

+1 212.857.0784

[email protected]

@melissarparrish

www.forrester.com

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