Marketers Need to Know the Truth About GPS

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As consumers, we use several location-enabled apps on a daily basis, making GPS technology part of our everyday lives. Brands and advertisers leverage this location data, derived from GPS signals, to inform their media and marketing plans.

For these companies, GPS-enabled location data is still new. So, while they want to use it, buyers in the market for this data don’t fully understand GPS data and the technologies behind it.

So, before rushing into talk of ROI and unprecedented marketing capabilities, let’s geek out for a bit. What is the technology behind GPS data, and what can it do for marketers?

Government-sponsored Technology to Get Excited About

GPS, short for Global Positioning System, is a global public service overseen by the U.S. government. The system, started in 1989, requires a constellation of at least 24 satellites orbiting the earth, which transmit radio signals to users. There are currently 31 operational GPS satellites in orbit; they circle the Earth at an altitude of about 20,000 km (12,427 miles) and complete two full orbits every day. Our smartphones use this GPS signal to determine our location and find a restaurant nearby, track our morning run, or provide turn-by-turn directions.

In order to determine a location on the globe, a GPS chip-equipped device (also known as a GPS receiver), such as a smartphone, needs to know the locations of at least four satellites in orbit above the device as well as where the device is in relation to those satellites. The location is determined through the process of trilateration: The GPS receiver draws a sphere around each satellite it can locate, and the point on the ground where these four spheres intersect is calculated as the device’s location.

It’s also worth noting that all phones, whether they have GPS capabilities or not, can provide location information by measuring the phone’s angle of approach to cell towers, the time it takes the signal to travel to multiple towers, and the strength of signal when it reaches the towers. This is known as cell tower triangulation. However, this type of location data is limited by its lack of accuracy, which is why the market shows a strong preference for GPS-enabled location data, and even the largest telcos are investing heavily in licensing GPS-enabled location data.

Marketing Perception vs. Location Imprecision

Pinpointing a device anywhere on the earth is an incredible achievement. We are talking about technology that links satellites that are orbiting 12,000 miles away to a device on earth that is smaller than five cubic inches. If we add in the fact that the GPS receiver on the smartphone needs a clear line to the satellites to be located, which is hard in dense cities with skyscrapers, there is obvious room for error.

I’m sure you have felt this frustration yourself. Either it’s the Uber that picks you up at the wrong block or the blue dot that keeps jumping around on the map, making it hard for you to understand where in Chicago you are.

For a marketer using location data for marketing campaigns, measurement, or analytics, it’s vital to understand the technology behind location data, or else it will cause a lot more pain and frustration than needed.

The appeal of GPS data is that it reveals the exact location of any device at any time. The problem? That isn’t true, at least not all of the time. GPS data can be very accurate, but marketers must accept that there is no way of knowing exactly where a device is at all times. For example, using device location to determine exactly where a consumer is within a city is, in most cases, an impossible task. The tall buildings block the signal to the satellites, while small storefronts packed closely together make it impossible to determine if the person is inside one store or another next door. Any brand, agency, or vendor who claims that they always have 100% accurate GPS location data is either lying or doesn’t know how the technology behind GPS satellites work. You do now, based on my short intro.  

No Value Without Transparency

This doesn’t mean that all location data derived from GPS satellites is inaccurate or useless as a marketing tool. It just means that marketers need to better set their expectations, know the data they are buying, and factor the limitations into their partnership agreements and marketing plans. This means looking under the hood at the source of the data, especially if it is being sold with a promise of pinpoint accuracy.

Brands need to push for transparency, asking about the source of the data, the dwell time of a device in a certain location, how many coordinates were used to confirm a location, and how many venues are nearby, among other factors. This information makes it possible to assess the accuracy and quality, which is the first step in understanding how the data might help within a campaign strategy. For example, with the limitations involved in measuring location in a dense city, a marketer should have low confidence in a dataset that supposedly contains consumers who visited an urban Starbucks location. If the marketer wants to target an audience of Starbucks customers, the potential inaccuracies mean this dataset will probably not move the needle on a campaign.

Marketers also need to understand that the value of a signal varies depending on the campaign goal. Some GPS data is useful in retargeting campaigns, and other data is valuable for measuring ad impact. Marketers should always request to see the full menu of data options if they are leveraging location in their marketing efforts.

GPS is clearly an exciting prospect for marketers to leverage, but marketing outcomes are determined by the data itself. Inaccurate data leads to poor-performing campaigns and unreliable reporting. If marketers want to ensure they are getting the most out of their data investment, they must push for transparency into location data sources. GPS insights are only useful if they are the result of quality data, and data quality is only measurable with transparency into the sources.

Thomas Walle is CEO & Co-Founder of Unacast. As a seasoned sales and go-to-market professional, Thomas’s expertise and track record lie in building complex partnership ecosystems on a global level and running sales and account management teams in the enterprise and consumer markets. Before he founded Unacast, Thomas spearheaded the business development and partnership department at streaming music service TIDAL. Tidal, which launched globally as the first HiFi lossless global streaming service, was later acquired by Jay Z.