Smart phones have changed the way we look, think and react to nearly everything online, including marketing and advertisements. It is estimated that 1 in 4 Americans routinely accesses the Internet through a mobile smart phone each day, a number that will only increase with the rapid availability of 3G networks and smart phone competition, such as Google’s Android phone. As rates and availability become more competitive, so too does the need for fresh and aggressive marketing to attract mobile users’ attention. A few days ago, AT&T unveiled a new service to do just that-- a location-based marketing service that targets users based on their phone’s GPS coordinates. And that could change everything.

ShopAlerts

AT&T Advanced Ad Solutions and Placecast announced on February 28, 2011 their unique marketing strategy, ShopAlerts. By using the internal GPS present on many smart phones, AT&T is able to gain clients’ GPS coordinates and offer special deals and rewards by nearby participating locations. Currently, the service is only offered to AT&T subscribers who reside in New York, Los Angeles, Chicago and San Francisco who have selected to receive the location-based alerts. AT&T is the first network to offer any service of this kind, paving the way for advertisements and marketing to be directed at a person in location-specific real time. The alerts also come with other pertinent information for the mobile user, including weather conditions, traffic times and information on the local shopping centers in and around the user’s area. The mobile deals, coupled with updates on traffic conditions and area information, have the potential to significantly simplify and expand the mobile user’s shopping experience.

Geo-fence

The service operates off of what AT&T refers to as a “geo-fence,” or a specific field of mobile information surrounding a participating store, event or location. When a mobile user crosses the perimeter of this “fence,” he or she is given an alert regarding the participating shop and location. This alert is targeted at smart phone users from the exact stores or events surrounding them, making it an extreme real time, location-based marketing tool. AT&T’s press release gives the names of the initial participating companies who will employ the geo-fence in their mobile marketing strategies: HP, Kmart, JetBlue, SC Johnson, Kibbles 'n Bits, Nature's Recipe and the National Milk Mustache "Got Milk?" Campaign are among them.

Tariq Hassan, Vice President of worldwide marketing and communications at HP, enforces the importance of the location-based service: "At HP, we are continuously implementing innovative new marketing platforms that will resonate with our customers' mobile lifestyles. ShopAlerts by AT&T service enables us to deliver relevant, location-based content to our customers."

Other Forms of Mobile Marketing

Mobile marketing exploded onto the scene with the increased popularity of SMS messaging in the early 2000s. In many parts of the world, SMS marketing remains a viable form of mobile marketing, where companies collect large databases of numbers and send advertisements in the form of a SMS. The Mobile Marketing Association has limited this type of blanket messaging in North America and parts of western Europe; however, in many parts of the world, selling databases of numbers to third parties is still regular practice. The most popular form of marketing is mobile web marketing, where advertisers pay for a slot of space on a website. Thus, when a mobile user loads a site, they also load participating advertisements. However, as web giants such as Google and Yahoo have been employing mobile web marketing for years, the effect on consumers wears off. Mobile users learn to “tune out” the advertisements and focus on the content relevant to their search.

And so enforces the genius of a service like ShopAlerts, where AT&T directly targets users based on their current location. AT&T has shifted mobile marketing from a passive to an active endeavor, evolving the mobile marketing strategy in the process. They’ll actively reap the rewards for doing so.