Effective Behavioral Targeting Depends on Accurate Data. So Why Aren’t We Demanding it Be Verified?

A rapidly growing portion of location-based advertising spend is shifting from targeted media to behavioral-based audience targeting. This essentially means that brands are moving away from investing in location-targeted advertising and opting instead for buying pre-packaged audience segments that reflect the desired location behaviors of their prospects and customers. This strategy makes sense if the audience data is accurate … is it?

The reality is that retailers and agencies have little to no certainty that the audiences they're purchasing display the desired behaviors, particularly when buying audiences based on location-based patterns. Let’s say, for example, a retailer launches a conquest strategy targeting people who have visited a nearby Walmart two times in the last month. How does the audience segment supplier prove that the data is true? And why aren’t agencies independently verifying it?

Location data, while powerful, is in short supply. Without independent verification, it's entirely feasible that retailers are wasting budget on inaccurate targeting.

What's particularly curious is that despite a slew of widely announced mobile operating system updates over the last few years, there has been no reported dip in location data supply.  Both Google and Apple have introduced new mobile OS features that inform users when an app is using location data and prompt them to choose between sharing data continually, only when the app is in use, or not at all. Google also allows users to delete location activity data directly in Google Maps. Even Facebook is rolling out a “Clear History” tool to give users more control of their data.

You have to imagine that some — if not many — people have taken advantage of these new options to protect their privacy. This should have had a negative impact on the quality and breadth of supply, yet no one in the marketplace is talking about it. How can it be that there seemingly remains no interruption in data supply or data costs? This is curious. Retail brand managers should be asking agencies and suppliers if and how privacy changes have affected the availability of quality location data and its effectiveness.

Given the potential supply shortage and the epidemic of fraudulent and poor-quality location data, agencies should have tools in place for verifying the accuracy of location-based audience segments, in the same way that they verify other digital advertising buys. Part of the reason that these measures aren't in place is because it requires an uncomfortable conversation.

Agencies must call their data providers and request they share raw audience files with a third-party verification partner. In today’s marketplace, it’s unlikely an agency is going to do that — or that a supplier is going to cooperate — unless a brand manager on the client side insists. Brands are most impacted by this issue and have the most power in the equation. Once retail marketers put their foot down and refuse to work with anyone other than pre-certified location partners, you can be sure that agencies and suppliers would comply.

Once location verification processes are firmly in place, there will be an adjustment period, but ultimately retailers and the entire advertising ecosystem will benefit. More accurate targeting should contribute to campaign performance, which would make brands happy and agencies secure in the fact that they're delivering value. Overall, as location data quality is increased,  brands and agencies will in turn increase their targeting spending — good news for suppliers.

Retailers, it's your budget and business outcomes at stake. It's time to start asking some tough questions about your behavioral-based advertising strategies. Doing so could provoke the changes the location-based advertising industry so desperately needs.

Jason DaWayne Smith is chief business officer at Location Sciences, an independent, third-party data intelligence company that verifies the accuracy and quality of location data used in proximity-targeted advertising.