Thoughts on 'The Location-Based Services Renaissance'

Having now thoroughly read 'The Location-Based Services Renaissance' white paper I mentioned in the last post, I felt impelled to respond to some of the points raised...

"One operator recently said, “No one appears to want to pay for [LBS] services, and for current services, demand is greatest among young people, who can least afford to pay for them.” " (p5)

Actually, many young people have little regard for how much money they spend on their mobile. This is especially true in New Zealand, as illustrated by this NZ Herald story about a 17 year old who sends about 8,000 text messages (i.e. $280 on Telecom) every month. Also, in mid to high socioeconomic classes, teenagers can have a lot of spending power, both in terms of the money given to them and the influence they have over their parents' purchase decisions. Finally, when they grow older and initially enter the workforce, they will be both tech-savvy and have a relatively high disposable income, since they may not need to support a family yet (some of them probably still live with their parents to save money).

"If the user’s experience is poor, they will abandon the service when the promotion is over." (p7)

This is consistent with services marketing theory, whereby the actual service experience has the greatest impact on customer value, satisfaction, etc. It's common sense!

"In Japan, carriers distribute Cell ID location data freely, encouraging application developers to post applications on their portals, which drives user traffic." (p8)

It's kinda like open-source software development - the more users you can get to actually collaborate and co-create the product/service with you, the more innovations you're going to get! Firefox is a great example, with a neverending myriad of plugins you can download to personalise and enhance the web browsing experience. (Yes, I'm a Firefox evangelist too...)

In the end, it's really the conclusions of the paper that I wanted to address:

"In the future, parents will be able to locate their children with the touch of a button." (p10)

I'm paraphrasing Russell Buckley here - basically, the above sentence should say 'parents will be able to locate their children's phone with the touch of a button'. Here's more reasons why child tracking is misguided. While it's very tempting (easy, even) to sell child tracking LBS to paranoid parents, unless the GPS/RFID chip is directly embedded in someone's body (in a difficult-to-remove place), people-tracking really equates to device-tracking, and it doesn't take a genius to work out how to get around that!

"Parole violators will be readily caught." (p10)

Don't they already have ankle-bracelets for that? And see my point above about the embedded-in-a-hard-to-remove-place thing.

"Mobile users will sign up to receive coupons for lattes on their handsets as they pass Starbucks." (p10)

Russell's ZagMe White Paper put it best when he did some simple calculations to conclude that a sale with at least a 5 pound profit margin would be needed just to break-even on this sort of mobile marketing (hope you don't mind me quoting just one paragraph!):

"This simple analysis explodes the popular Starbucks myth - for low cost items, mobile marketing used in this way is simply unaffordable. It can only be justified for higher priced and higher margin products." (p27)

Perhaps a better example would be to use a CD store selling CDs or even concert tickets (actually, I think they do that already, though not in a location-based way).

Overall though, still a very good paper - I'm always happy to find white papers because they're generally quite practical, not to mention easy to read (compared to some academic journals)...

Some really good LBS white papers

I should have noticed this earlier, but better late than never, I guess! TruePosition has a great Location Resource Center, which contains some recently-written white papers on why LBS uptake has been disappointing, from both operators' & consumers' points of view. You have to provide some information (name, email, etc) before you can download them, but it's quite worthwhile. =) The following were especially useful:

Wireless Location on Target?: a research study by BWCS Research, London (May 2004)

"The most common barrier to the growth of location services cited by the operators was the lack of a proven business case for them. This was followed by inadequate performance of the currently-installed technology (for the most part Cell-ID and Enhanced Cell-ID), and lack of attractive applications. However, consumers said the main reason they did not use location services more was that they were unaware that they existed. Only 3% of our respondents claimed to have used a location based service, and around half of this very small number were dissatisfied with the services they used."

It just goes to show that even if you think something's gone wrong for one reason or another, your customers will still have a completely different point of view! The low consumer awareness of LBS (thus leading to its subsequent flop) illustrates the need for one thing: better marketing!

The Location-Based Services Renaissance: A New Formula for Success (February 2005)

"In 2000, analysts predicted that location based services (LBS) would generate $81 billion USD in revenues by the end of 2004. But as operators know too well, reality has fallen far short of these original predictions. How can operators turn hype into bottomline impact? To succeed in LBS, operators need to close the gap between current applications and customer needs."

In the 'Formula for LBS success' diagram, at first glance I thought one of the circles said 'interactive marketing', but then I realised it was actually 'instructive marketing'. I guess I'm just a big interactive marketing buff. =) In addition to what's already there, I thought perhaps they should also have included 'Permission marketing' as one of the key factors for success? Overall, it's more descriptive than prescriptive, but I guess they're trying to sell you their services after all, not give it away for free!

smart2go

From gate5 - can this be classed as a location-based tourism application like Timespots?

smart2go™ turns your mobile phone (Symbian Series 60, Series 80 and Microsoft Windows Mobile Smartphone), PocketPC or Palm into a full scale navigation system. Navigate easily with clear voice commands in 5 languages. Enjoy the added value of premium guides providing restaurants, cafés, W-LAN hotspots or hotels, all detailed in your map data.

Not sure if this has a P2P/collaborative component though... For some reason, hearing about the more social-network-esque services seem more exciting, in an 'empowered consumer' & 'co-creation of value' kind of way. =)

World66 vs. Lonely Planet

Well, this just goes to show that I really should really explore a site properly before I post about it!

World66 on your phone
"And for those of you who have a phone with GPRS and know how to roam, please use or XHTML-guide. You can access it at world66.com/alt/xhtml. It automatically starts with the homepage of the country you're in. So if you access it from Marrakesh, it starts with the Morocco page.
It's still in Beta, so please let us know if you have any problems. We also like to hear positive feedback, by the way!
If you have a phone that allows you to read PDF files, you can of course also download the PDf guides. It's up to you."

I guess the value that LBS can add is much more specific information, down to the street-level perhaps? Now that I'm having a wee exploration of mobile travel guides, I notice that Lonely Planet actually does offer mobile services. On one hand, Lonely Planet has huge brand awareness & value (ranked 5th in the Asia Pacific region). On the other hand, World66 is free, contains collaborative user-created content, and has the potential to spread like a virus through the blogosphere. Which one would you go for? Please email me your comments! =)

World66

Just stumbled across World66, "the travel guide you write". Basically it's like Wikipedia, but for travel destinations - I haven't done a thorough exploration yet, but what I've seen so far looks very promising. There's even a Mapsonomy section which is reminiscent of Mappr, but it links to the actual article about the location, not just photos from it. A powerful & logical next step would be to link World66 with Mappr. The thing I really like about World66 is its global nature, whereas Mappr is still only US-focused at the moment.

Where I'm getting at, of course, is location-based tourism! It doesn't even need to be 'location-based', per se. Basically, if you have a mobile device that can link up with a WAP version of World66 (kinda like the Flickr mobile site), then you can access all that wiki-travel advice. If you factor in the device's context-awareness, then I guess it could just automatically retrieve the most relevant entries & display them when the page loads? A bit like how Google.com automatically redirects to your country of origin.

Going one step further, you could easily link these caches of user-created travel/tourism data from World66 into some sort of digital graffiti system, like YellowArrow or Grafedia. Or adapt the info to be able to be sent over SMS. The opportunities are endless.

It makes sense that location-based services will have much greater value and be able to encourage quicker/more widespread adoption if it has a P2P/C2C collaborative content-building element. It helps that much of the collaborative 'infrastructure', if you like, already exists in the form of sites like World66 & Flickr. Why start from scratch when you can build alliances and tap into already-established communities of users and content relevant for your service?

HotLink: m-payments with Vodafone

This is a bit old actually, but here it is anyway:
Vodafone New Zealand introduces new top up system for mobile credit

"Vodafone is launching an exclusive new service called HotLink, that allows New Zealand users to top up their Prepay or On Account balance directly from a nominated bank account using their mobile phones.
...
Vodafone says that 80% of its customers rely on Prepay mobiles. It is estimated that it takes each customer an average of 10 minutes once a month to buy a Prepay recharge card. TheHotLink service will give customers the option to choose to top up their credit anywhere and at any time directly from their mobile, even overseas in Australia, UK and Spain.

Vodafone Head of mCommerce, Hamish Sansom says these statistics confirm the need for an innovative solution which will help save time and provide greater convenience for mobile users everywhere."

As soon as The National Bank signs up, I'll give it a go... Meanwhile, I'm off for the week! Going to do the Central Otago Rail Trail, won't be back in Auckland till the 24th of April, so in the meantime, explore the extensive lists of blogs to your right! I especially recommend The Mobile Technology Weblog, Pasta & Vinegar, The Pondering Primate & Near Near Future. =)

[P.S. Another article about the same story at the National Business Review - Vodafone: Top up with a click]

NZ Wireless Data Forum

Remember how I said I wished there was something like Mobile Monday in New Zealand? Well, turns out there is an equivalent, run by the New Zealand Wireless Data Forum. Of particular note is Convergence 2005, "Australasia's largest wireless and mobility conference and exhibition". I would love to go, but this one is in Wellington, and I would've just come back from my week-long break in the South Island, so... hopefully the next Convergence will be in Auckland! But I'm definitely going to Minna's LBS presentation in July. =)

ThereArePlaces & Re:call

There have been a lot of exciting developments in location-based tourism lately! For example:

New Online London City Guide

"TeleMapics LLC, a privately held business focused on travel, tourism and location based services, announced today the launch of its London City Guide, one of a new series of online city guides featured on its travel web site http://www.ThereArePlaces.com. The new City Guide is available in the Destination Guide section of ThereArePlaces under the United Kingdom listing. The Guide reviews the top thirty tourist destinations in London, which are highlighted on well-designed, detailed, street level maps. In addition, the symbols identifying the locations of attractions on the maps are “clickable” and linked to descriptions of the attractions in the detail section of the guide."

Also: New mobile application to amplify experience for Granville Island visitors

"Visitors to Vancouver’s popular Granville Island can now virtually explore everything available on the Island, all by using their handheld PDA. As part of a trial this spring, Granville Island will offer a richer, amplified experience to visitors, thanks to a new wireless application developed in Vancouver by Mobile MUSE."

Will we see services like this launched in Auckland and other parts of New Zealand soon? Definitely (and I know this for a fact). But will they be successful? In terms of the innovators & early adopters (i.e. niche market), probably - given it's all done properly in terms of technical reliability and marketing.

What about the early/late majority (i.e. mass market)? Time will tell... Sticking to the aforementioned rules of mobile marketing and providing real value to users would certainly help!

BBDO & Mobile Marketing

Been trying to catch up on my Bloglines feeds, and noticed quite a bit of press around the blogosphere about BBDO's findings re: mobile marketing - see Russell Buckley and Vangorilla's posts.

Basically it all revolves around three things that I've known for a while, and are a bit Blindingly Obvious, but good to reiterate all the same:
1) mobile phones are becoming increasingly pervasive & essential to people's everyday lives
2) mobile marketing must be permission-based
& 3) the mobile channel enables firms & consumers to interactively engage in a two-way dialogue, encouraging things such as brand loyalty

Where does location-based tourism fit in? Well, LBT is just another form of mobile marketing, only it's traveller-specific, but all the mobile marketing rules still apply. If anything, users will be even more receptive to mobile marketing messages because it's an essential part of their tourism experience!

If I have time later, will try to blog about the latest LBS-related lit I've found - it seems to be a pretty hot topic for academics this year! =)

Technorati tags: location based, mobile, mobile marketing, permission marketing

Even more location-related blogs/sites

Location! Location! Location!

"a location-aware technology blog by Harry Chen"

However the front page is blank for some reason, and the last time it was updated was in February this year. Still - looking forward to going through the posts... I haven't even really had a chance to do that for it is all about yet!

Another interesting find - The MUSE Intranet (not the British band, who I'm actually a big fan of). Especially pertinent is the Locative Links section, which includes a link to the Siemens Digital Graffito project. Worth a look!

Technorati tags: location based

Loughborough LBS Research + MoMos

LBS Research at Loughborough University, UK:

"The Valued LBS project is a joint academic/commercial research venture, running from June 2003 to December 2005. The partners are ESRI (UK), Ordnance Survey (UK), Yeoman Navigation (UK) and VTT Industrial Systems (Finland).

Between them, the partners have expertise in:

• The human factors of mobile telephony and the adoption of new technology
• Geographical information systems
• Design of travel and traffic services
• The design of mobile devices

Valued LBS is an applied research project – the main focus is on providing answers to research questions that are relevant within a commercial market.

The specific aims of the project are to conduct original work to:

1. Identify the customer requirements for a set of target LBS users and scenarios.
2. Assess the gap between the needs of consumers and current ways of satisfying those needs.
3. Develop and test new concepts/prototypes for services and interaction methods that will support enhanced LBS.
4. Develop new, multidisciplinary approaches to using concepts of ‘value’ to inform the design of new or enhanced services."

Very interesting - especially their 'Our Research' section, which will be somewhat mirrored by my thesis. While you're there, don't forget to fill out their fun LBS questionnaire: "to understand the relevance of LBS to young professionals". =)

Thanks to Minna Pura of CODE for sending me the link - she also pointed me to Nordic Wireless Watch, another useful site for mobile news - too bad there's no RSS feed! (Yes, I've been reading too much Scobleizer...) I didn't know this, but it seems that the Finns have their own Mobile Monday - I'd only come across Russell Beattie's Mobile Monday before. It would be neat if there was an Auckland-based MoMo...

Technorati tags: location based, mobile monday

IFITT.org

International Federation for IT and Travel & Tourism

"The International Federation for IT and Travel & Tourism (IFITT) aims at the promotion of the international discussion about information technologies in the field of tourism.

Information and communication systems forming a global network are having a profound influence on the tourism and leisure industry. Reservation systems, distributed multi-media systems, mobile working places and electronics markets are notable results of this development.

Advances in the use and development of tools, technologies and methodologies that have facilitated the efficient networking of information systems in the tourism industry and their economic and organisational impacts are to be discussed within the federation. Members of IFITT are either persons working in this area or organisations, companies and research institutes (institutional members)."

They also publish Information Technology and Tourism, a journal I'm trying to get a hold of at the moment because of this article, but it's proving difficult because my university doesn't have a subcription to it at all... In any case, I'm going to try to contact the local IFITT person for my thesis research. =)

Technorati tags: tourism

Location-based tourism literature

As promised, here are the LBT papers I've come across, mostly found via the ever-helpful Google Scholar.

CRUMPET is an EU funded project which specifically applies LBS to a tourism perspective
[EDIT: Here is the official website of the CRUMPET project]

"Mobile users such as tourists require mobile services. Handheld devices promise access to a range of travel-related services while on tour. A number of usability issues, however, still ask for intelligent new solutions. Issues are, for example, the limited capacity of handheld devices, user interaction via small screens, mediation of heterogeneous services, as well as other issues of wireless access to internet-based services. Key features of the CRUMPET system are personalisation, location awareness, interaction facilitation and service mediation. Its realisation as a multi-agent architecture opens up additional prospects."

And here are the articles relating to this research...

• CRUMPET: Creation of user-friendly mobile services personalised for tourism by Poslad, Laamanen, Malaka, Nick, Buckle & Zipf (2001)
• Personalized and location-based mobile tourism services by Schmidt-Belz, Nick, Poslad & Zipf (2002)
• User-adaptive maps for LBS for tourism by Zipf (2002)
• Developing Location Based Services for tourism - the service providers view by Zipf & Malaka (2002)
  
• Location-based mobile tourist services - first user experiences by Schmidt-Belz, Laamanen, Poslad & Zipf (2003)

ArcIMS

"The application allows users to quickly enter location information based on street maps displayed in ArcIMS. The location point information entered is then linked to uploaded text, images, hyperlinks, and video. The application is designed to help communities build their own location-based data that can be fed to multiple location-aware devices as part of a mobile, electronic tourism effort. The overall program is designed to create layers of location-specific historical, cultural, scientific, and environmental information."

• GIS and Enlightened Location-Based Tourism: An Innovation Whose Time Has Come by O'Looney (2004)

The Lancaster Guide Project

"Our system provides an electronic handheld guide that visitors to Lancaster can use to access information about the city, create tailored tours of the city, and access interactive services."

• Using and determining location in a context-sensitive tour guide by Davies, Cheverst, Mitchell & Efrat (2001)

Tourist Guide (Australia)

"Our focus for this project is on software support for location based applications; we are not just interested in the location but also other elements of the user’s context, such as buildings in view, attractions and equipment near by, such as public telephones and toilets.
...
We have been investigating location based tourist applications targeted at off-the-shelf hand held devices, such as the Compaq Aero."

• Developing a location based tourist guide application by Simcock, Hillenbran & Thomas (2003)

Other papers included:

• Location based destination information for the mobile tourist by Eriksson (2002)
• Designing and implementing an open infrastructure for location-based, tourism-related content delivery by Kakaletris, Varoutas, Katsianis, Sphicopoulos & Kouvas (2004)
  

Enjoy!

Technorati tags: location based, tourism, crumpet

That's why it's called permission-based marketing...

Via textually: College students space out cellphone ads

[EDIT: Unfortunately, the article is now only available to registered readers, so I decided to reproduce the whole thing here]

College students space out cellphone ads
Published April 3, 2005

MUNCIE, Ind. -- College students are being bombarded with cellphone advertisements through instant and text messaging, but few remember much about the product or company, says a new study from Ball State University's Center for Media Design.

The study of 1,171 students at Ball State in February found one in four students reported receiving advertisements on their cellphones. Only 5 percent of those getting ads were able to recall the business and only 1 percent of all students responded to any ad offers. Nearly 90 percent of the ads remembered were from pornographic Web sites.

"The use of cellphones and instant and text messaging has become ubiquitous on college campuses, overtaking e-mail as the main form of communication," said Michael Hanley, the study's author and an advertising professor.

"This surge in wireless communications is opening a Pandora's Box for advertisers to target the elusive college student. Many advertisers see the cellphone as the best way to reach a segment of the market that traditionally has been hard to reach."

In addition to being unable to recall a particular product, 92 percent of students found unsolicited ad messages annoying and 67 percent were less likely to purchase a product from a business sending instant message cellphone ads.

"It's no wonder students don't like to receive unsolicited ad messages because they often have to pay for the text message or call received," Hanley said. "Even though it's illegal to send unsolicited ads to cellphones, the number of ads continues to grow.

"If an advertiser is sending a message but the receiver isn't paying attention--or worse, is annoyed to get the ad--it's a wasted effort," he said.

Advertising to cellphones is a recent phenomenon, having grown from modest activity in 2000 to today, when 43 percent of text messages sent are "spim," a term used to describe spam on cellphones and messaging services, Hanley said.

The online study of college students also found:
- 97 percent had a cellphone.
- 68 percent sent text messages with their cellphones.
- 14 percent sent instant messages with their cellphones.
- 50 percent listed instant messaging as their top choice in communicating.
- 44 percent said they couldn't live at college without instant messaging.

Kind of Blindingly Obvious, but it's always nice to see studies confirming what we already know - that mobile marketing must be permission-based. Of course, spammers don't really care about legalities or ethical behaviour - but there are authorities who deal with those sorts of people. Our job as responsible marketers (not an oxymoron!) is to offer easily-customisable opt-in mobile marketing that creates a conversation between the firm and the customer. It probably all sounds very familiar because it's frequently repeated throughout the blogosphere and beyond, but that's because it's a good mantra to have.

On the other hand, people respond quite positively to mobile marketing when they're in control - they may even thank you for advertising to them (as seen in Russell Buckley's ZagMe white paper)! All this is really nothing new, yet I still hear stories about people being spammed on their mobiles. So I'll keep repeating the importance of obtaining permission in the hope that more will jump on the permission-bandwagon.

The best kind of marketing strategy is grounded in common sense. In this case, spam = bad for both you and your customers, especially mobile spam. Let's not forget that!

Technorati tags: permission marketing, mobile, SMS

ColonDot & RedBlog

Fantastic! Another LBS blog joins the blogosphere:

ColonDot

An attempt to track the interesting web pages i come across relating to media delivery to mobile devices and location-based services.

Speaking of new mobile-oriented blogs, make sure you check out RedBlog, by Jon Beverley of RunTheRed. =)

Finally, I should really remember to keep up with what's going on at iStart, 'New Zealand's e-business & e-commerce solutions, research, case studies.' Unfortunately, they have no RSS feed, so that makes things slightly more difficult! I still subscribe to their email newsletter though. One of their newest stories is about PTT (push-to-talk), and while they did explain the current situation in NZ with regard to PTT quite nicely, I found their intro paragraph,

'Believe the hype! Set to rival texting as mobility’s next ‘killer application’, Push To Talk has finally arrived'

...a bit difficult to swallow. They even say it themselves in the last paragraph:

"Who is most likely to embrace PTT technology?
As PTT requires a defined user group to commit to a unified purchase simultaneously (a construction company, a taxi fleet etc) it’s likely that both Telecom and Vodafone will be going after the business market first. While there is nothing stopping anybody from buying a PTT phone, it requires an active user group to be of much use in PTT terms, so widespread consumer uptake will be slower."

I think PTT is kind of like MMS, but even less consumer-oriented. Hope Vodafone & Telecom aren't banking on it too much, or maybe they know exactly what they're doing? I don't know anyone who's ever used PTT here in NZ - I'm slightly biased, but why not invest in more LBS instead?

Technorati tags: location based, mobile, PTT