This is the 23rd installment this year of our Deep Dive Into Local series. For the week ending Monday, June 27th, Mary Bowling and Mike Blumenthal shared their thoughts about the previous week in local. The complete video, including links and commentary on critical happenings of the previous week is posted in the Local U forums (paywall). In the second half of that video, they take a deeper strategic and tactical dive into one interesting area that caught their attention during the week.
In this discussion Mary and Mike talk about Facebook's recent announcements of partnerships with Square and Marketo to close the local attribution loop.
Mike: Finally with this, we'll switch into our deep dive. This is some news from Facebook and their ad development in local. Facebook, as we've been saying, has had a number of slow and steady local developments that have made their product more useful and local. Recently, they've put maps in their local ads, adding to a location-based awareness to give brands a better chance for you to visit the location.
Simultaneously, though, they have discovered what Greg Sterling referred to as a "holy grail of advertising" by establishing a new set of partnerships with point-of-sale systems, like Square and Marketo, so that they could actually know whether once you've seen the ad, if you then ended up purchasing something from one of those stores. Even if you don't purchase something, Facebook also will know you visited a store based on a combination of features, from GPS, beacons, Wi-Fi, radio signals and cell towers tied to bricks-and-mortar coordinates. So now, the fact that they were giving away beacons, for example, makes sense in this context of closing the loop of attribution.
Mary: Yeah, and that's something that Google has struggled with for a very, very long time. Once again, Facebook just kind of learned from all the lessons and came out with something that is working immediately upon release.
Mike: So, Google does have the feature, at least, in test mode with large locations, large brands, and large locations. They're talking about releasing it more broadly, but there is a huge privacy issue. If a store like Barbara Oliver gets a visit from you, Google would know it's you and that data would be exposed, and Barbara would know it's you. You were the only Android user, whatever, on that day, so it becomes a very big privacy issue. I think Facebook pushed into beacons a little earlier and more successfully.
Google has released some stuff recently which will allow this feature to be released in small businesses, and that's this nearby feature of a physical web where businesses can put a beacon, a little device like this, and they can associate a URL with it, and that URL then will be soft notified to people with Androids. So, you're walking by this business or you're in this business, you get a soft notification on your Android that there is a URL that might be worth visiting. With that sort of data at enough businesses, Google could then provide equal or better attribution to a very small business with enough anonymization that it could be successful.
It's clearly where things are going. Right now, you have to work with proxies, right? How many people got driving directions? How many people clicked to call? These are fairly good indicators of local intent, but they're not exact match indicators of local intent and of actually having seen your ad and know...you spent money on an ad, did it generate a local sale? That's what Facebook is doing with this, which is pretty significant.
Mary: Right, and not just did it generate a local sale but what was the value of that sale? How much was that sale? You can actually see your ROI on Facebook advertising.
Mike: And by going with Square and Marketo, they're going with two market leaders in the POS space and giving them a lot of data that they could then use big data to project and predict for other businesses. So even if your business doesn't have Square or Marketo to have the exact information, Facebook would be able to model results and apply them to almost everybody.
Mary: So, does it seem to you perhaps that Google might be going after the big brand market and Facebook might be trying more to go after the small business market?
Mike: I think that Google is more sensitive because of their dominance in search. They have to be really careful around privacy issues, and attribution raises a number of privacy issues. They did have solutions that I read about that they were testing, for example, in Google Maps two years ago, to actually beam data from Google right to a phone or right to a user through Google Maps. So every phone that had Google Maps on it would become a participant. It's pretty spooky because Google knows where you are, and they know where you've been and where you're going, and that's very telling information.
If I went to a lingerie store and bought a lingerie and didn't give it to my wife, it's like, whoa. It's really telling information. Google, being in a monopoly position around that, has to be really careful, so I think it's as much that as demonstrated. And Larry Kim did a good article on some interesting things around the new Google Ads and attribution, which I'll include. Google is very strongly intent on bringing that capability to small businesses, but they have to follow the privacy changes that are led by Facebook. They can't lead them, I think, is the issue.
Mary: Makes sense.
Mike: So, with that, I think we'll call this a wrap, and we hope to see you next week.
Mary: Thanks, Mike.
Mike: Thank you, Mary. Have a nice week.