Location based segmentation in Canada
The intro: Location Based Marketing is not only about Check-ins
There is a common weakness in the marketing field. Marketers often design their strategy around a new trend or the next big thing. In a more complex digital world, it is now more important than ever to tackle the digital complexity by avoiding a trend and focusing on the 360 view that combines the strength of the digital and traditional world. One of these new trends is described as Location Based Marketing or LBM.
LBM means more than only check-ins on Foursquare and Gowalla. Location based marketing encompasses all the activities around the Users, Merchants, Marketing and Location.
Actually, the only translation of this strategy (LBM) is the check-in feature. This is a strategic challenge because none of the studies and actual experiences have shown concrete results yet:
- According to Pew Internet, Check-in location services have been used by 4 percent of online Americans
- Consumers are slow to respond to location-based marketing
- In Canada, the use of LBS / Check-in apps is not yet mainstream (See Foursquare and Gowalla’s Ranking)
The question: How does the click react to location in Canada?
Is it true that the 3G Check-in feature is designed to be a mainstream strategy, everywhere in Canada?
According to comscore, Yellow Pages Group (YPG) is the biggest Location Based network in Canada with more than 10 millions UVs. compared to Google that converts only 20% of its traffic into Location Based. YPG is one of the heaviest digital players in the Canadian Location Based Marketing.
Here are some findings from the YPG Network results.
- In terms of numbers and ROI, the Click is not reacting the same way from one location to another.
- There are four Location Segments in Canada that share some equivalent characteristics.
- When it comes to Location Based Strategy, the surprise finding is that print and Web are mainstream with strong results (depending on the analyzed categories and Locations). Mobile is in a very strong position to become mainstream rapidly.
At this point, you’re probably disappointed or skeptical that I have used the word “print” in a digital post. Please note that I’m not in any way defending the print directory. I’m sticking to my findings, based on the data and the results that are available.
This is why the Marketing field is now so complex! It’s no longer about print, mobile or Web as silos. The 3 channels offer opportunities depending on the goals that a marketer wants to achieve versus targeted locations. The debate needs to avoid focusing on the channels but on the business Goals (strategy) and the results.
The biggest challenge in marketing is to know when and how to use each Channel in a way that allows maximizing the end results.
The findings : The 4 location based canadian segments
- Average Population in those Locations : 1 955 622
- Average Internet Penetration Rate : 83.46%
- Number of locations : 9
- Reach : 52% of Canadians
- A Segment of 17 600 600 Canadians on 33 739 900 Canadians
- Cities with more than 500K Population : Hamilton (Ont.) , Winnipeg (Man.) , Québec (Que.) , Edmonton (Alta.) , Ottawa-Gatineau (Ont.-Que.) , Calgary (Alta.) , Vancouver (B.C.) , Montréal (Que.) , Toronto (Ont.)
- Average Population in those Locations : 365 933
- Average Internet Penetration Rate : 82.61%
- Number of locations : 9
- Reach : 10% of Canadians
- A Segment of 3 293 400 Canadian
- Cities between 200K & 499 999 : Regina (Sask.), Saskatoon (Sask.), Windsor (Ont.), Victoria (B.C.), Oshawa (Ont.), Halifax (N.S.), St. Catharines-Niagara (Ont.), Kitchener-Cambridge-Waterloo (Ont.), London (Ont.)
- Average Population in those Locations : 155 187
- Average Internet Penetration Rate : 75.92%
- Number of locations : 15
- Reach : 7% of the Canadians
- A Segment of 2 327 800 Canadians
- Cities between 100K & 199 999 Population : Peterborough (Ont.), Thunder Bay (Ont.) , Saint John (N.B.) , Moncton (N.B.), Guelph (Ont.), Brantford (Ont.), Trois-Rivières (Que.) , Saguenay (Que.) , Kingston (Ont.) , Greater Sudbury (Ont.) , Abbotsford-Mission (B.C.) , Kelowna (B.C.), St. John’s (N.L.) , Barrie (Ont.), Sherbrooke (Que.)
- Average Population in those Locations : 50 000
- Average Internet Penetration Rate : 60 to 70%
- Reach : 31% of of Canadians
- Segment of 10 518 100 Canadians
- Cities below 99 999 Population
Depending on which location segment you’re targeting, your marketing investment needs to be adjusted.
Check-in features can’t be mainstream today for two main reasons. First, the check-in features are being used by only Cosmo and metro segments. Second, the smart phone users are not representing 100% of the population today. Depending on your business Category, a Location Based strategy will still need the 3 channels to deliver results.