Geo-social networking from the likes of Gowalla, Foursquare and Loopt are gaining major momentum with users, and are trying to leverage the popularity to harness the power of location-based advertising through content deals. The “holy grail” of sorts, however, is leveraging the community and location aspects to offer hyperlocal performance-based advertising- or a means to actually deliver a consumer to a store.
Loopt, on the heels of signing yet another content partnership with Tasting Table to inject relevant content, revealed that its true focus remains on offering a much more accountable approach to local advertising. The company has a product launching soon that will help advertisers pay for the number of people they can actually deliver, utilizing a true performance-based model on a hyperlocal level.
Building on the “check-in” mindset of its users, Loopt could essentially allow a company to keep track of ads shown and whether people actually visited a location later using GPS or voluntary location-sharing. The proliferation of GPS-enabled devices makes the concept much more viable, and allows for a cost-per-action pricing model in lieu of more traditional and outdated cost-per-impression or CPC models.
The company’s CEO said there would a self-serve way of buying these ads. Much farther down the line, one could imagine a bidding model where businesses set the value of a potential store visit from a new customer, for example, akin to Google’s advertising bidding system for clicks.
The concept has a lot of traction, and could easily be made possible if the right steps are taken. Solving the problem of true performance-based hyperlocal marketing is not an easy road to travel, but given Loopt’s user base — made possible with strategic partnerships with mobile operators — as well as its perceived understanding of the many aspects and obstacles present, Loopt has a better chance than anyone to make it a reality once and for all.
