Reportstack shows the popularity of mobile devices and media is spurring major growth in the Location-Based Search and Advertising Market in the US, which is projecting a healthy CAGR of 43.01 percent from 2013-2018.
Location-based services (LBS) use location, determined by a user's mobile device, to search for and promote products and services near the user. Location-based advertising is based on the integration of three variables: What (the user’s requirement), where (their location) and now (a user’s necessity for real-time information).
Market Growth Driven by Increasing Adoption of Location-Enabled Smartphones and Tablets
In recent years, the penetration and sales of GPS-enabled smartphones and tablets have increased significantly in the US. In 2013, the US reported a penetration rate of more than 65 percent for location-enabled smartphones, and this is expected to increase to over 90 percent by 2016.
“The huge number of smartphones being used in the US acts as a catalyst for the incremental adoption of mobile LBS applications such as location discovering, friend finder and location-based advertising, shopping and networking,” .
Enterprises have realized the value in offering adverts specific to their customer’s location and are adopting LBS to attract new customers.
Companies such as Starbucks Corp., L’Oreal Inc., and PepsiCo Inc. are all testing the feasibility of location-based marketing campaigns. For instance, L’Oreal has launched its location-based advertising as a pilot marketing campaign.
“This kind of location-based mobile advertising offers huge growth potential and is much more cost-effective than traditional print and even electronic media,” .
“Given the relatively low cost of location-based advertising, enterprises are witnessing cost benefits from related marketing activities and transferring these benefits to their customers. It also helps enterprises understand their customers and offer real-time deals to attract new clients.”
Foursquare Labs Inc.
To determine these market scenarios over the next 3-4 years, the analysts have conducted in-depth analysis of the impact of market drivers, challenges and trends featuring data on product segmentations, vendor shares, growth rate by revenue and an evaluation of the different buying criteria in the order of importance.
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