Factors affecting location based advertising

Abstract

Smart phones have become an integral part of people’s lives with significant implications for information exchange and communication. The effectiveness of consumer engagements with known platforms can easily be assessed by seeing the number of users and their activity on the top three social networking sites. 7 million users with 3 billion shares a day for Facebook, 180 million users with 155 million tweets a day and 10 million users with 3 million check-in a day for Foursquare. (Leong, 2011)

Mobility extends the engagement of social interactions into location based services (Leong, 2011). Location Based Advertising (LBA) offers new ways of interacting with target audiences for retailers. Unlike SMS marketing, this is a form of ‘Pull Advertising’ and reaches customers only once they reveal their geographical location using a smartphone.

"If the ad is contextually relevant it tends to get better reception than other forms of advertising." (Ferenczi, 2011) The objective of this study is to probe into the factors affecting LBA. The role of moderating variables on the external factors is also examined. This objective was achieved with relevant literature review and by developing a set of 9 hypotheses. Data was collected through a self-administered and computer assisted survey. A total of 325 responses were collected and 239 were used for data analysis.

The usefulness of this study is limited by time and effort constraints. For future studies, descriptive research could be carried out to investigate more factors affecting LBA. A larger sample size could also be targeted to reduce sampling errors and increase accuracy of the study