Location is all the rage, but what about those WiFi hotspots?

By Wenlei Ma | 11 September 2013

The industry has been extolling the virtues of location-based advertising for years. Think of the possibilities! But the lack of WiFi hotspots in public places is limiting its growth.

SoLoMo. Social Local Mobile. It's a guiding light (or apparently should be) for the marketing fraternity. With smartphone penetration in Australia at 65%, it's seen as a no-brainer for marketers to target consumers on their favoured device. And what could be more relevant than doing that with a localised offer.

But the mechanisms of location-based advertising still present challenges in Australia. In a Mobile Trends Report paper released by IAB Australia, Ikon Communications Sydney digital director David Thanisch identified the lack of free WiFi in public spaces an impediment to the expansion of location-based advertising.

Thanisch said in the UK and US, the high number of WiFi connection spots has seen WiFi become the preferred form of targeting over GPS. However, in Australia, our public WiFi networks are not as built up. Mobile operators don't share its customers' location data with publishers, he said.

“So until the WiFi networks in Australia are built up to such an extent that coverage is universal, location-based advertising will be restricted to commercial hotspots like shopping centres and other areas that provide a WiFi network,” he added.

Locations which have free WiFi hotspots in Australia includes some Westfield shopping centres, McDonald's outlets and other cafes.

Telecommunications research and consultancy firm BuddeComm estimated in 2010 there were 3,000 WiFi hotspots in Australia, predominantly in cafes, hostels, hotels, shopping centres and libraries. It added while 1,000 of them were closed down by Telstra, thousands of new ones have been added since then.

Users (aged 14 years and over) of WiFi hotspots have increased from 1.56 million in 2011 to 2.06 million in 2012, according to BuddeComm based on ACMA data.

Thanisch said there are real opportunities for retailers to capitalise on location-based advertising, given they are the few that have access to WiFi hotspots.

He said: "In the long-term, location-based advertising services will become an incredibly powerful tool for advertisers who can look for new and interesting ways for brands to engage and interact with consumers through the mobile channel. Mobile will become the default method for targeting people and premium rates will be charged for geo-location data, but it will come with greater rewards."

Bohemia strategy director Chris Christofi told AdNews: "I think it's clear as we move from spend and hope to spend and know, location-based advertising and the closer you can get to the point of purchase becomes far more attractive to advertisers. The path to purchase is something a brand or retailer would love to be able to manage more effectively but that issue becomes the access to the data.

“Accesss [to WiFi] is broadening and it's something people want, and people do get their way. As a frequent traveller, it's great being able to access WiFi at Central Station but I look forward to getting access to it on the train. Then you can reach people at a point in time where they're perhaps more receptive and looking for stimulation and experiences mobile can deliver.”

Other papers in the IAB's Mobile Trends Report were 'The Big Data Future of Mobile Media' by Big Mobile's John Hawkins and ' Think Moments, Not Mobiles' by Google's Suzie O'Carroll.

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