O2 UK unveils location marketing; signs L'Oréal and Starbucks

A consumer trial of location-based marketing has been launched by O2 UK that it claims is a world-first. The opt-in service, based on 'geo-fencing technology', allows brands to target direct promotions at consumers within a specific area.

O2 Media, the division that is responsible for the trial, said that L'Oréal and Starbucks were the first two brands to sign-up to the service, although discussions were underway with other major names.

According to O2 Media, Starbucks stores have been geo-fenced to offer customers money off its recently launched Via instant coffee range, as have supermarkets selling the Via range. L'Oréal's geo-fences are found around Superdrug stores, offering customers a buy-one-get-one-free promotion on Elvive hair care products in store.

O2 is using LBS technology developed by US-based Placecast that has already been trialled in the US with the clothing brand North Face and restaurant chain Quick Serve, but the company's CEO, Alistair Goodman, said O2 was the first operator it was aware of to adopt LBS to mobile marketing and target it at its customers.

Goodman said the geo-fences could be set to any size in any location and brands could tailor any element of their campaign, such as time-specific individual promotions. Goodman describes Placecast's work with Quick Serve in the US, where customers are offered breakfast, lunch and dinner promotions according to the time they enter a geo-fenced area.

"It's completely different to anything else in the market," claimed O2 Media MD, Shaun Gregory. "Mobile advertising expectations have been enormous in the UK but haven't lived up to the hype. This could be the catalyst and deliver the holy grail of what mobile is about."

Gregory sees text messaging as an untapped tool in terms of mobile marketing as it is a long-term staple of the industry. He said: "Messaging is universally accepted and adopted across the market, and importantly they are opened and read."

For more on this story:
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Related stories:
O2 UK: 1M opt-in to mobile ads
Europeans do respond to mobile ads - well, nearly 30% do
Ericsson looks to attract operators with new mobile ad platform
Germany voices concern over iPhone location data collection

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