Barabasi, Foursquare, and the brave new world of location marketing
Posted on | February 22, 2010 | No Comments
Author:
Jason Voiovich
Ecra Creative Group
Key Points:
1. Barabási and his colleagues at Northeastern University studied cell phone users in Europe, finding individual’s day-to-day movements were predictable 66-80% of the time.
2. If we combine the thinking behind this study with location-based social networks such as Foursquare and a variety of location-sensitive smart-phone apps, we can see the implications for marketing.
3. The theoretical foundation for movement predictability should give marketers the justification they need to begin expanding location-based marketing exponentially.
You are so predictable.
Specifically, you are so predictable 93% of the time. Albert-László Barabási and his colleagues at the Center for Complex Network Research at Northeastern University in Boston recently published a study in the journal Science that tracked data from over 50,000 cell phone users in a European market.
The results of the study fly in the face of what we may like to think of ourselves, and perhaps confirm what my wife always reminds me: I am not the free spirit I wish I was.
I’ve summarized some of the key findings in the chart below:
The methodology was quite ingenious. Each time a cell phone connects to the network, it must relay through a geographically nearby tower. The cell phone company needs to track that information in order to determine usage patterns, capacity issues, and maintenance schedules. Data on specific names and phone numbers is irrelevant. Using the raw data (and some wonderfully fun regression analysis), Barabási found the model could predict the average person’s whereabouts 70-80% of the time on any given day. Overall theoretical limit of predictability: His model can peg us over 93% of the time.
Paradoxically, the closer you live to your workplace, the slightly more random people tend to be (hypothesis: people have the extra time to be impulsive). Most surprisingly, unpredictable people are largely absent from the population. So just when I thought only I was boring, it turns out, we are all boring.
I feel better.
Of course, burglars have known this for generations, but I’ll let that go. And just to debunk the thought process that cynically says Barabási simply articulated the obvious, understand that while we may have known this to be true intuitively, we never had the data to do anything with it.
Thanks for 5 billion cell phone subscriptions worldwide, now we do.
Barabási lays out a number of potential implications he thinks are the most important: transportation engineering, public health, and urban planning to name three.
While I don’t dispute the benefits, there’s one other immutable force of human behavior: The drive of marketers to make money. And we can act faster than a new light rail line can be built.
How might we do that?
Have you heard of Foursquare?
No, not the game we played as kids, the social networking service.
Think of Foursquare as location-based Twitter. When you arrive at a location, you can use Foursquare to “check in” to that place. The more you do it, the more “rewards” you earn – up to and including being the “mayor” of a particular location. (A colleague of mine happens to be the “mayor” of Union Depot in St. Paul.)
As of January, the service featured about 275,000 registered users.
Now, I have heard the complaints from the social media-debunkers. Most assertively, they claim the number of active social media users is quite small, and that traditional marketing and advertising techniques reach much larger audiences. They cite recent statistics that only about 30,000 people Tweeted during the SuperBowl, whereas the television audience went well into 9 figures.
Understood, and agreed.
But think for a second about what the combination of Barabási’s study and Foursquare means for marketers. Foursquare only has about 275,000 users, all having fun telling you where they are at a given moment. From a “traditional” marketing perspective, that wouldn’t tell me much – it would only tell me where that small sub-segment was at any given time. But what if I also knew that I could use human predictability metrics and begin to generalize that small population to the much larger whole.
Now we’re talking.
Put that together with the iPhone and Blackberry applications we already freely allow to track our movements via GPS, and it’s clear we haven’t even begun to scratch the surface.
With studies like Barabási’s forming the foundation for a high degree of certainty, expect marketers to begin putting up serious dollars very soon.
Related Links:
“Limits of Predictability in Human Mobility” Study FAQ
Science Mag Abstract: Limits of Predictability in Human Mobility
Pre-order Barabási’s book
Learn about Foursquare
Tags: Barabasi > Foursquare > location marketing
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About
Jason Voiovich
Ecra Creative Group
Phone: 651.209.2778
Principal and co-founder of Ecra Creative Group, a Minneapolis, MN based creative services firm specializing in brand development, reputation process management, naming/trademark, and product launches to drive measurable business results.
