Tuesday, September 01, 2015

Why GOOGL Scrapped a Google Maps Marketing Plan

Google Maps ads were eliminated before they even had a chance

Monday morning, Fortune reported that it had obtained a document describing a secret Google (GOOGL, GOOG) initiative that had originally been slated for release in early 2015, but was instead scrapped. That initiative was called Google Here, and according toFortune, “was potentially too invasive, and the company wasn’t sure if many retailers would want it.”

Google Here was designed to work within Google Maps, and the app would have served up various display ads and other marketing messages, including coupon offers and loyalty card access, all based on the smartphone’s location in reference to participating retailers.

Google Here Axed for Being Too Invasive

The question, then, is whether Google’s decision to axe the Google Here project was indeed a wise move, and if GOOGL will be better off with the alternative Bluetooth-based solution that replaced it. Alphabet CEO Larry Page was apparently concerned over the public’s reaction to such accurate location information, given the exponential increase in personal privacy concerns, as well as the potential annoyance of unwanted display ads.

Interestingly, the Google Maps location-based ad program is strikingly similar to the Facebook (FB) update released late last year, which laid the groundwork for the social media company’s Local Awareness Ads program. Essentially, Local Awareness Ads behave in much the same way as GOOGL’s unreleased platform.

Additionally, the Apple (AAPL) iBeacon, a device capable of creating a localized network within retail establishments, was recently announced as the focus of a pilot program in partnership with Target (TGT) stores. The iBeacon will allow retailers to deliver ads and related marketing messages directly to Apple iPhone users within the confines of the store, based in part on their exact aisle location.

Did Google Pass on a Good Thing?

Considering that Facebook and Apple, two of GOOGL’s primary competitors, have been working to get their own location-based marketing tools in place, there must be rather significant potential for the technology to bring in revenue.

Regardless of the method used, whether it’s Bluetooth, GPS, or some sort of beacon transmitter, there will always be a number of consumers who object to having marketing messages and advertisements served up based on nothing other than their physical location and proximity to a retail establishment. In today’s day and age, privacy concerns are a major issue, and rightly so considering the high-profile hacks and data breaches that have plagued countless companies.

However, there will also be a number of consumers who accept, and even welcome, those types of marketing ads. The question, though, is whether the number of accepting consumers is enough to generate results positive enough to make these types of programs worth it for retailers.

Only time will tell, and unfortunately there isn’t sufficient evidence to support the inclusion of location-based marketing programs such as Facebook’s Local Awareness Ads, Apple’s iBeacon, or a similar solution tied to Google Maps.

Bottom Line on Scrapped Google Maps Ads

One thing is certain — the use of exact location-based targeted marketing messages is the way of the future. Whether it would have been more advantageous for GOOGL to re-engineer the Google Maps location-based advertising program is a moot point, as Google Here has been shuttered in favor of Eddystone, an open-source program with similar features to Apple’s iBeacon.

As for GOOGL stock, neither program would likely have been powerful enough to move the needle by itself, as the bulk of Google’s revenue still comes from search-related ads. So, the location-based marketing ploys are little more than an attempt to get on board with some of the country’s major retailers, but there’s still so much uproar over privacy concerns that it will be a while before any of these solutions get traction.

Article originally appeared on InvestorPlace (09/01/2015)

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