New Location-Based Services Are Poised to Enter the Mainstream

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To a surprising degree, the panels and presenters at Street Fight’s Local Data Summit last week in Denver emphasized a similar theme: we’re about to see a plethora of new technology-enhanced real-life experiences centering on ingenious uses of data. We’ve seen such surges before, from the emergence of social networking to the adoption of smartphones. The signal feature this time around is an orientation toward experiences situated in a physical context. The question the new technologies will answer is this: “What do I need my technology to do for me now, in this place, at this time, under these circumstances?”

For Amber Case of Esri, whose opening keynote set the tone for the conference, the vision is a seamless, noninvasive linkage between everyday activities and invisible or “calm” technology. Case sees a trend in contextual tech extending back several decades to innovators like Steve Mann, who began experimenting with wearable computers in the 1970s and built a device in the 1990s that could overlay messages based on visual cues, such as a reminder to buy milk triggered when viewing a grocery store sign. Mann’s work strongly prefigures the emerging contextual technology for smartphones, Google Glass, and the like, as well as Case’s own experiments in using GPS enabled phones to create games and data services that incorporate invisible “buttons” or triggering actions based solely on the user’s physical location.

One thing seems certain: internet-enhanced engagement with physical spaces, still largely confined to the outdoors, is gearing up to move inside. At the conference, a panel of representatives from Intel, Qualcomm, and KS Technologies delved into the recent activities around indoor search. Apple’s announcement last year of the iBeacon indoor positioning system, which uses simple, low cost Bluetooth sensors to detect a user’s location and works with both iPhone and Android devices, has helped to kickstart a wave of development that will likely culminate in a host of new services, from in-store virtual assistants offering deals and helping shoppers find and purchase products, to event-based apps helping attendees find their seats or the shortest concession lines. According to a new study from ABI Research predicts 20,000 stores will offer indoor search by 2015, with more than 800 million smartphones making use of indoor location services by 2018.

Some smart companies are making use of older technologies that happen to provide the data they need. One of my favorite presenters at the Local Data Summit was Alexandre Winter, CEO of Placemeter, whose company applies image recognition software to 500 live video feeds available throughout New York City in order to calculate wait times at popular restaurants, the average speed of cars on a given block, or how many pedestrians are in front of the Disney Store on Times Square (and by inference, how many are inside the store as well). It’s easy to imagine some fascinating extrapolations from the data being gathered.

Notwithstanding the positive outlook for startups in the space, the challenges of building search around physical context are considerable. Though technology standards like iBeacon are paving the way, developers still struggle with issues around battery life and hardware infrastructure. Privacy continues to be a major concern, given that location services depend heavily on access to personal information. It’s likely that privacy concerns will make location apps almost entirely opt-in based; only those users who are most comfortable with the tradeoff will choose to exchange personal data for the incentives offered by an app.

It will be especially interesting to see applications for contextual technology that have not yet been thought up. Retailers have long hoped for indoor and location-based services to provide closer and more immediate contact with consumers, but if these services offer nothing more than in-store coupons and the like, they will hardly excite enough attention to win broad adoption. A company like Foursquare, with its game-like architecture, urban focus, and young demographic, seems especially well positioned to make use of iBeacon and other granular location platforms in innovative ways. Companies like Goodzer, Retailigence, and Krillion (owned by Local Corp), who work to catalogue the inventories of thousands of stores, could open their databases to consumer-oriented services that would allow for broad-based local comparison shopping, flexible delivery and pickup services, and powerful real-time search. It will not be surprising to see data-driven technologies like these becoming part of our everyday lives within two to three years.

Damian Rollison is Director of Market Insights at SOCi. SOCi is the leading CoMarketing Cloud for multi-location enterprises. They empower nearly 1,000 brands to automate and scale their marketing efforts across all locations and digital channels.