Thinking about Local (and Mobile) in 2014

Map and pinI’ve been thinking quite about about local and mobile for 2014. Lots of predictions about digital marketing and trends have come out in the past few weeks. Most of them are overly broad, aggressive or, on the other end, obvious.

On the one hand people like to make bold predictions because they’re sexier and get attention. As in the past, what we’re likely see however is evolutionary, incremental change rather than anything radical (sometimes big acquisitions can be radical though). I suspect this year will be the same with “advancements” across a range of technology and digital marketing categories with local or offline implications.

In the broadest sense the major change in “local” over the past two years has been the tectonic shift to mobile and multi-platform and their implications for merchants and marketers, consumer behavior, offline ROI tracking and location targeting (including indoors). We don’t yet know how many tablets (largely PC substitutes) were sold over the holidays; however smartphone penetration in the US now stands at 65% and will likely hit 75% or more by Q4 2014. In Europe penetration numbers are comparable in the major countries.

I’ve been covering and writing about local, small business marketing and location-targeted advertising for nearly 15 years — shockingly. And despite the presence of a number of dominant internet brands (e.g., Google, Facebook, Yelp, Apple, Amazon) I feel like there continues to be opportunity in the consumer market and for B2B services providers.

Roughly a decade after “committing” to local Google hasn’t won. One could even argue that outside of Maps Google’s local strategy and execution are currently a mess. Despite a significant opportunity, Facebook is moving very slowly in local. And for its part, Yelp has raised its profile in major US and select international markets yet it hasn’t consolidated its leadership across local categories or markets.

There continues to be opportunity (even in the mapping segment) for novel, unique or highly utilitarian approaches. Indeed the local market feels more “open” to me than it has in several years. The relatively rapid and massive growth of mobile apps such as Instagram, Snapchat, Whatsapp and others showcase both the instability and opportunity of the mobile consumer and social media markets.

Indeed, Instagram and Pinterest could emerge as major platforms for local marketers this year. It’s entirely possible that new consumer mobile apps with a local-social focus or other local aspect could arise and gain major adoption. I’m not saying it will happen but it seems more plausible to me this year than in the recent past.

On the B2B/marketing side, I think we’ll continue to see advances in location targeting, local data usage and local marketing campaigns — especially in mobile. Large marketers are getting much more sophisticated about how to integrate and utilize location in their creative and ad targeting. Local and offline data will become a larger and more frequent part of online marketing campaigns. And location data will become a more pervasive element of programmatic ad buying both in mobile and online.

Privacy continues to be a major and challenging issue for everyone in 2014.

This is also the year of the multi-platform campaign. Such campaigns will also take advantage of emerging offline tracking capabilities (Placed, PlaceIQ, Google, etc). Marketers will have much more visibility on the offline and in-store impacts of their campaigns, which will really shake things up.

As you probably know I’m also very bullish on the long-term impact of indoor location as well. But we’re likely to see only incremental movement in that area this year, as more venue owners and retailers test and quietly roll out their indoor location analytics and tracking systems. A few consumer-centric standouts in the indoor location space will emerge in 2014 however.

Among small businesses I think the story is more of the same: too many channels, not enough time, considerable frustration and continued churn. This remains a hard and expensive space for everyone. I do believe however that SMBs are gaining greater clarity and sophistication about where they need to be and how to get there.

Reviews will likely continue to be the “hardest part” of local for many SMBs and marketers however.

This is the year that “wearables” become established as a device category, mainly driven by the adoption of fitness wristbands (e.g., Fitbit) and perhaps later this year smartwatches (with a fitness emphasis). Google Glass and and its competitors don’t become mainstream this year or next year. It’s still too strange and “unnecessary” a product for most people.

Stepping back again, we’ll see incremental growth in mobile payments, still mostly in a vertical context for consumers. This part of a larger trend toward “local commerce,” the blending of e-commerce transactions (including scheduling) with offline service delivery or fulfillment. In turn this is all part of the larger convergence between the online and offline worlds, including “the internet of things.”

Virtual assistants, machine learning and “AI” also will play significantly in local and mobile (in tandem with “big data”). We’ll see more local and personalized recommendations (or predictive search) based on our combined online behavior and movements in the world. (Foursquare is one of the leaders on the local recommendations front.) And while Siri and Google Now are the known entities in this segment, there’s a ton going on in the enterprise with virtual assistants. Increasingly we’ll see these dynamics play out with consumers through novel use cases (see, e.g., Expect Labs MindMeld).

The biggest changes in local may turn out to be “under the hood” or on the B2B side this year. But there remains plenty of consumer-facing opportunity as well. It’s no longer “early days” but the market is far from locked up.

Let me know your thoughts. Do you agree, disagree or want to add anything to what I’ve said?

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15 Responses to “Thinking about Local (and Mobile) in 2014”

  1. Marketing Day: January 2, 2014 says at

    […] Thinking about Local (and Mobile) in 2014, Screenwerk […]

  2. Don Campbell says at

    Hi Greg,
    Thanks for your insights here.

    It’s truly amazing how hard this space is to crack. To me that’s a good thing – because it means there are still many opportunities to provide valuable products and services – and not just by the big players.

    What about Foursquare. Do you think they are heading in the right direction to make a difference in this space? I like some of the new things they are doing and have found that I’m using the app more as a result.

  3. Greg Sterling says at

    The recommendations? Yes, they’re doing a lot of work on the “back end.” I still think they exit through an acquisition rather than a public offering. But I agree they’re doing some really interesting things.

    They’ve been engaged in what you might call a slow-motion pivot.

  4. Greg Sterling says at

    Don:
    As I said I feel that there’s more opportunity now than in the immediate past. One of the reasons is mobile and the volatility of social. There’s also the fact that nobody’s cracked it.

  5. Don Campbell says at

    Lol – “slow-motion pivot”. That’s a good way to describe it.

  6. John Fifield says at

    Hi Greg,
    A bit of unabashed self promotion here for my company and what we’re bringing to market on ’14. 
    Given that it’s really hard to be a stand out star in a standards based world as far as the technology is concerned then maybe it’s a little creativity with the business and commercial models that is needed.
    With our Zapcher product we think we can give local businesses the real time edge in using mobile marketing at a price point that’s competitive with other forms of media. 
    We’ll concentrate first on getting the customer to the store before we worry about the in store communication, although it seems a logical extension that we eventually take the process through to completion and transaction.
    It surely is an interesting space and you provide some thought provoking insights.
    The Zapcher app is in beta and can be found either at Google Play Store for Android or iTunes for Apple devices.
    Your thoughts appreciated 

  7. Greg Sterling says at

    John: I’ll take a look. Thanks

  8. Bill Bean says at

    You’re right, Greg. The whole review thing will continue to be one of the most fundamental challenges. It’s somewhat platform agnostic, though the usability factor is big when it comes to getting people to do it (ie it has to be easy). And, of course, it means businesses have to actually do good work.

    I was also a bit surprised that you didn’t mention Foursquare. Seems they’ve definitely moved out of being just another social app to being a major data aggregator. If you haven’t already, check out David Mihm’s recent post over at Moz: http://moz.com/blog/foursquare-as-data-aggregator

    Best of luck to you in 2014!

  9. Greg says at

    I respect David very much and saw his post. I disagree that Foursquare has become a “major local data aggregator.” They certainly supply local business data to third parties however their accuracy isn’t great in many instances. I agree that over time they have the potential to be a significant data provider. But that’s not a business model in itself anymore. 

  10. Greg says at

    Bill: I do mention Foursquare in terms of local recommendations and combining online and offline data. 

  11. Marketing Day: January 2, 2014 | CABizNews.com says at

    […] Thinking about Local (and Mobile) in 2014, Screenwerk […]

  12. pkatkin says at

    Greg, you’re spot on about two points for SMBs: 1) that Google’s local search model and the complex SEM/SEO “products” it spawns are too complicated for most small businesses and 2) small business owners would rather putting “marketing” budgets into local commerce solutions that improve productivity than online media campaigns that are hard to track and deliver questionable ROI. Traditional lines between media, customer service and scheduling/inventory management disappear in a digital/mobile environment. There is real opportunity for the company that makes it easy for SMBs to understand how it all fits together in one simple to buy/use solution but we haven’t seen it yet!

  13. Greg says at

    But why haven’t these problems been solved in more than a decade of trying. It’s not like people aren’t aware of the issues

  14. John Fifield says at

    The answer likely lies in the fact that in reality no one has really tried to address the problem that understands what it is to be a small business. Technology tends to want to deal with enterprise size issues and provide solutions that are too complex, many small businesses don’t have an IT department and rely on 3rd party expertise to implement/deliver everything from the web and social media through to their accounts and inventory systems.
    The companies that develop solutions don’t have the ability to market and support a product that works at a simple grass roots level or have a network of resellers and distributors that can make the proposition work.
    When some one does get it right and comes with a user friendly proposition that is capable of being used by most with just rudimentary skills and knowledge and can provide evidence of true ROI then the paradigm shifts.
    It’s not impossible, hopefully we’ll prove this. 

  15. Greg Sterling says at

    It may be “structural” — true SMB servicing and “scale” may not be compatible. 

  16. Nate Nordstrom says at

    As a regular reader of your blog – keep up the great work. ‘Looking forward to what 2014 will bring! Many opportunities exist in the local/digital space. A shameless self promotion here… our approach is to build a mobile app which combines all the EXISTING resources into one simple app. Take a look at RochesterNow in the app store for insight into what we’re building. So far, folks in our city are loving it. What are your thoughts, Greg, on our approach vs. what other options already exist in the local app space?

  17. Greg Sterling says at

    I’ll try and take a look. Thanks for the heads up.

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