Re:Tooling — Geolocation: Location, Location, Location

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The recent news that microblogging service Twitter was ready to support geolocation data—storing latitude and longitude coordinates on a per-tweet basis—has the business and social worlds abuzz about the potential monetization opportunities. 

Potential may be the key word. Vuk Trifkovic, a senior analyst at Ovum, calls this a greenfield opportunity that few have caught onto. “I’m not finding enough companies doing this,” he says. “This hasn’t broken through to the mainstream…and it’s a huge deal.”

Trifkovic adds, “There are many ways to geolocate different types of content. You can look at [Internet Protocol] networks to see where users are accessing networking services from, through the proxy of a mobile device, or through unstructured content.” 

Companies will pay for this: In a subscription model, for example, users can expect to invest anywhere from several hundred dollars per month to hundreds of thousands of dollars, depending on Web-site traffic and the intended use of the geolocation data. (See “Here, There, and Everywhere,” page 38, for a deeper dive.) 

Geolocation is best known for its use in personal navigation devices (PNDs) from makers such as Garmin. However, Forrester Research finds that phone-based navigation will outpace the growth of PNDs by the end of 2010 and eclipse their penetration by 2013. Charles Govin, a Forrester principal analyst, says phone-based navigation appeals to members of Generation Y, who are eager to interact in real time with other location-sensitive applications, including social networks. “A navigation service is mapping a company’s best information on routes, resources, etc.,” he says. “When you can enhance it with what ‘people you care about’ have found interesting, valuable, or of concern, it can add quite a bit more.”

Having geolocation technology on smartphones is another phase in location-based technologies, says Dominique Bonte, practice director for telematics and navigation at ABI Research. He believes that while this phase is already in “full swing,” we’re quickly entering another: “It will be about location becoming ubiquitous, becoming an embedded feature and function of just about every single mobile service or application,” he says.

Trifkovic calls this a perfect storm of adoption and technological progression, leading to large-scale enterprise use of geolocation. He finds more adoption for vertical-specific needs, including targeted marketing, delivering specialized and tailored content, compliance, and fraud prevention. Kerry Langstaff, vice president of marketing at Quova, a provider of Internet Protocol–based geolocation data, explains that clients’ usage splits fairly evenly into detecting fraud, compliance, and marketing—for now. “The biggest opportunity is in the marketing arena, because anyone with a Web site would have a need for geolocation to serve relevant information to their visitors,” she says. 

To Trifkovic, though, the real promise of geolocation is that it will cross organizational silos, requiring companies that commercialize the technology to package it more tightly. “In time, we will see more application programming interfaces and productized hooks into main applications like CRM or…back-end systems,” he says. 

That may be coming, but Langstaff says some companies are seeing the benefits now. Quova customer Continental Airlines, for example, deployed geographically targeted homepage banner ads for people in Cleveland, Houston, and New York. After six months, the airline realized a 200 percent increase in clickthroughs of its localized banner ads and a subsequent 20 percent increase in ticket sales. 

“People have always said with CRM you give people personalized information, and if it helps, it will help increase sales,” Langstaff says. “Here’s an example of how that actually works.” 

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Sidebar: Endless Possibilities

Sidebar: What to Ask About Geolocation

• Do we have global buy-in?
• What's our backup strategy?
• Where will visitors from unsupported countries land?

Source: Byte Level Research, "Going Global with Geolocation"

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Sidebar: Questions to Ask Geolocation Providers

• With billions of IP addresses in use, how do you know that your geolocation information is safe?
• How frequently is your data service updated?
• Can you locate users via mobile devices or WiFi hotspots?
• Can you analyze my online traffic to assess my current online risk?
• What happens if I find an IP address that is incorrect?

Source: Byte Level Research, "Going Global with Geolocation"

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Sidebar: Vendor Shortlist

• Akamai www.akamai.com | Product: EdgeScape | Services*: Advertising Decisioning, Application Performance, Digital Assets, Dynamic Site, Professional Services
• Digital Element www.digital-element.com | Product: NetAcuity | Services*: Online Advertising, Content Localization, Enhanced Analytics, Geographic Rights Management, Advertisement Trafficking
• DoubleClick www.doubleclick.com | Product: DART | Services*: Advertisement Serving, Advertisement Trafficking, Reporting, Campaign Optimization
• MaxMind www.maxmind.com | Product: GeoIP | Services*: Fraud Detection, Advertisement Serving, Traffic Analytics, Content Customization
• Quova www.quova.com | Product: GeoDirectory Server or Quova On-Demand | Services*: Localized Web Content, Geotargeted Advertising, Regulatory / Contractual Compliance, Fraud Prevention, Analytics

*Services are not all-inclusive

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