Why Haven't Location-Based Services Taken Off Yet?

Why_Haven't_Location_Based_Services_Taken_off_YetIt's been 9 months since Facebook Places launched.  Combining the benefits of location-based services (LBS) with the scale of Facebook  was supposed to be the spark that lit the blue touch paper of  the 'check-in' explosion.  But it hasn't happened - not yet at least - and a new study from White Horse Productions in the US helps to shed some light on why LBS in the US and the UK has been more 'fizzle' than 'bang' to date.The first problem is awareness.  Of the 437 smartphone users who were surveyed by White Horse, only just over half (56%) were aware of LBS. This correlates with recent research in the UK that found that 48% of teens, usually the earliest adopters of social technologies, hadn't heard of LBS either.Amongst smartphone users who had heard of LBS, adoption was far from universal - in fact, the White Horse survey found that only 39% of smartphone users who knew about LBS were using them. In demographic terms, these were most likely to be young men in their 20s. The most popular services were Facebook Places (42%), Google Latitude (27%) and Foursquare (25%).So clearly even those who have heard of LBS are not falling over themselves to get involved.  The survey found 2 issues were key to this underwhelming take up.The first was privacy - a particular concern of female smartphone users. People didn't want to disclose personal data about their movements, primarily for safety and security reasons.But the second reason was perhaps more revealing - non-participants just didn't see the point.  They either felt that there wasn't sufficient benefit for them to get involved or that their tools they already had at their disposal were adequate to fulfil the role that LBS were percieved to fill.This second problem may be addressed at least in part by the wider roll out of Facebook Places Deals - when consumers have more tangible financial rewards for checking-in, perhaps the activity will become far more widespread?  Except that deals and rewards were well down the list of benefits mentioned by those that were actively using LBS.The primary personal benefit that active LBS users quoted was the 'connection to other people I know or could meet' (mentioned by 41% of the sample), followed by 'finding a place liked by people I trust' (31%). Savings and rewards were only mentioned by 8% of respondents.LBS clearly offer benefits for retailers - the ability to identify customers who physically visit stores, to maximise purchases from those customers and to acquire new customer due to the viral advocacy a check-in creates. But clearly awareness is a problem and even those that are aware believe the benefits are outweighed by the privacy concerns.So if there are tangible benefits for brands, how can they help facilitate greater adoption of these services?Well, the report suggests greater transparency on privacy should be the starting point - clearly, the hope that people won't realise the privacy implications by tucking terms and conditions away in small print is unrealistic.In fact, Facebook Places, heralded by many as the key catalyst in the adoption of LBS, may be part of the problem. Facebook users have been promiscuous in their building of networks, but the very extent of their networks may now be exacerbating privacy concerns.  The report recommends starting with one of the tools specifically built for mobile sharing  - like Foursquare -or using white label tools to build specific mobile sharing networks based on communities of interest.Retailers also need to offer users more tangible rewards. Discounts and offers may be part of this, but benefits needn't be monetary. Offering exclusive information and events, or even the ability to connect and share with like-minded individuals may be reward enough - the research suggestion that 'connection' was the primary benefit that participants sought from LBS. But retailers need to strike the balance between offering genuine incentives and excessive rewards that may alienate other loyal customers who have genuine reason for not wishing to participate.And finally, brands need to make their other social followers aware of the LBS activity that's already happening. Awareness is clearly a problem, and the more brands share the activity of existing LBS advocates, the more existing social media followers will want to get involved.Until privacy issues are addressed by the likes of Facebook Places, LBS probably won't be mass. But as smartphone adoption grows and deals become more widespread, they will continue to grow.  Now represents a window of opportunity for brands to experiment with programmes that genuinely reward advocacy to prepare themselves for the growth in participation which will surely come.