Pre-GDPR, geotargeting and local advertising was one of the fastest growing marketing mediums. 2 years post-GDPR, geotargeting has become a significantly smaller focus for many ad tech companies. Ad tech is shifting away from targeted ads, even as business demand rises. Location-targeted ads were predicted to grow at a rate of 24.5% CAGR for 2020, but now, that rate has slowed to 17.4%. GDPR is definitely a culprit, resulting in higher cost per click and reduced efficacy of geotargeted ads. Advertisers also face wider location regions and have more difficulty assessing location before buying data.
While tackling the challenges of geotargeting in a post GDPR environment is certainly difficult, it’s far from impossible. Adcombi continues to deliver, with geotargeting advertising using tools like double verification and dynamic fallback ads to ensure ad mismatch remains at a minimum, advertisers always see value, and consumers are always matched with the most relevant ad.
Accurate location targeting is key to driving value with geotargeting. Adcombi uses double verification to improve the accuracy of matches.
How it works:
Adcombi’s multi-location technology means every location in a franchise or distributor owns its own campaign, with its own budget. Every campaign is linked to a line item on the DSP, with a geofence. When we win the bid, we check the distance from the consumer to the location and only display the ad if it’s within the set range. We bid on ads based on initial location, verify the location of the consumer after winning the bid, and then show a dynamic ad with either local, national, or fallback content depending on verification results. Fallback ads might comprise a national campaign or another ad (e.g., World Health Organization) is displayed instead. And, ads are displayed in real time so everything remains GDPR friendly.
While geotargeting has a lot to offer, it’s still a costly form of advertising. GDPR has only driven costs up. Yet, over 87% of advertisers using geotargeting report a positive impact on campaigns. Geotargeting is a powerful way to connect to consumers and drive traffic to local distributors and franchises. Successfully navigating the market means reviewing options and making choices that suit your organization and its needs. Some of the most important include geotargeting range, content type/source, and target.
Range – Most advertisers normally want to narrow their range as much as possible. Unfortunately, this isn’t always a good idea. For example, Adcombi data shows that mismatches increase as range decreases. Hyperlocal campaigns using mobile gps data normally see a mismatch of 2-6%. This means 6 in 100 consumers might see an ad that doesn’t completely match their location. This ratio decreases as you widen the range. It’s also important to consider that mismatches heavily depend on business. Industries like auto-sales, which have wide geofences mapped to specific postcodes, will see significantly lower mismatches than quick-service restaurants relying on hyper-local advertising. At the same time, with 40% of our inventory coming from GPS targeting, hyper-local is completely possible and largely accurate. However, the smaller your range, the lower the bid-inventory and advertising opportunities.
Location Source – IP address masking means that IP data is significantly less precise than mobile GPS. IP location targeting sees an average of 10-20% mismatch within a 15km range. IP is popular and cheap, and it makes up about 60% of all available inventory. Mobile vs Desktop – Most advertisers currently prefer desktop ads. However, this isn’t always the best choice. Desktop is currently more expensive than mobile. But, that is changing quickly. Mobile is famous for misclicks, but users are becoming more tech-savvy and mobile purchases are increasing. You might prefer mobile in several scenarios.
Eventually, there is no one-size-fits-all approach, even for single businesses. Most benefit from running multiple campaigns with different targets, to benefit from both wide-availability inventory and hyper-local inventory.
WIFI data only ever comes into play during verification or when mobile data and connections are excluded. This may be important because GDPR measures mean the last four numbers of the IP address are hashed to zero, reducing accuracy. At the same time, there are benefits to both, because mobile phones use a broader GPS location, which might increase mismatch and fallbacks.
Local stores and shops heavily rely on local advertising. However, if you were to limit advertising to geolocations within a few hundred meters, you'd hardly bid on any ads. Creating a second campaign with a geofence set to within a kilometer radius of your store would increase bids, while reducing precision. You’d see trade-off but would get results from both. Of course, your product or service needs to be an impulse buy (affordable, food, etc.) and your website or landing page need to be mobile friendly to make either of these targeting options work.
Larger chain stores, dealerships, and franchises can win more bids with a wider network. Adcombi offers location-specific targeting perfect for dealerships and franchises with postal-code limitations. Our process, which includes double verification, reduces mismatch and advertising outside your location as much as possible. Unfortunately, we can never guarantee a 0% mismatch, because eventually, we’re working with broad data from other publishers.
Geotargeting is more in demand than ever. It offers opportunities for advertisers to ensure their ads are being seen by relevant people. The GDPR makes geotargeting ads more complex, but certainly not impossible. Adcombi has come a long way in tackling these challenges to deliver a truly quality and dynamic geotargeting solution. At the same time, we’re constantly working to improve, to tackle new challenges, and to further close the gap between the demand for local advertising and technical capabilities.
Contact us to learn more.