2016 Predictions: No.8 – Connecting Online and Offline with “LROI”

This post is part of a series of 2016 predictions from industry experts.

Connecting Online and Offline with "LROI"

Greg Sterling, Local Search Association, @gsterling

When most marketers think of location and mobile devices, they think primarily of geofencing. Yet consumer location and location history offer much more than basic radius targeting. They represent new tools for insights into real-world consumer behavior and audience identification, based on shopping patterns, store visits and brand affinities.

For example, people who visit multiple auto-dealer lots and showrooms are more likely to be actively in the market for a car than those who simply visit auto websites. Other information such as residence zip code and additional demographic attributes can be combined with location data to create powerful and specific audience segments for marketers to target.

In addition to these powerful new targeting capabilities, location will become a standard for attribution. The ability to determine store visits and offline actions after online or mobile ad exposures will make location a critical attribution tool. Accordingly, we'll see the rise of "location ROI" or "LROI."

Embodied in this concept is the proposal that digital marketing should be measured in terms of its impact on real world consumer activity instead of abstract or proxy metrics such as click-throughs (CTRs). So rather than optimizing or measuring campaigns on the basis of impressions, CTRs or even "engagement," more campaigns will be judged according to whether they're driving real-world actions such as store visits or purchases.

In the past, the online and offline worlds were distinct. Now, via mobile devices, offline actions and online advertising are cross-pollinating. Offline activities inform online targeting, which is subsequently measured according to offline impact.

Next year, in one form or another, location will be a part of nearly every mobile campaign, whether aiming toward awareness or direct response. It will take the form of location-inflected audience targeting, real-time geotargeting or offline attribution – or all of the above.