Show me the Pokémoney

RickWith rapid advances in geolocation driving adtech the success of Pokémon Go is merely an indicator of much bigger things to come, says Rick Mulia. And the market best be prepared.

“I just caught a Squirtle at the Petronas Towers”, might not be something you’ve heard before, but if Pokémon Go continues its journey to global domination, that may become something you’ll hear more often.

Nobody could have predicted the extraordinary success  of Pokémon Go, which despite only launching in early July, has already overtaken Twitter in daily active users, is giving Facebook a run for its money and is now the most popular gaming app in US history.

According to analysts, Apple stands to rake in $3bn in revenue from the Pokémon Go craze in the next one to two years as iPhone users can buy ‘PokéCoins’ from its App Store to unlock additional features.

When the free mobile app was first released, details were somewhat shady on how it would be monetised and the extent to which it would be opened up to advertisers. But we now know location-based advertising is going to be a big part of how the gaming platform funds itself.

Niantic CEO, John Hanke, has said that advertisers will be charged on a “cost-per-visit” basis, similar to the “cost-per-click” used in Google’s search advertising.

mcdonalds pokemon go brands logo

McDonald’s is the first major company to partner with Pokémon Go, and this collaboration will take place in Japan, where the app has finally launched. The chain’s 3000 restaurants will be important locations for players in Japan.

Other businesses such as restaurants and bars have taken advantage of the game by buying ‘lures‘, an in-app feature that attracts Pokémon and customers to a specific location.

Early signs are showing this approach could prove extremely lucrative for Pokémon Go’s owners, Niantic. But, the truth is, the potential is even bigger than that and Pokémon Go is really just at the tip of the iceberg for a massive, location-based advertising revolution.location based servces icon geotech geolocation

Advances in geo-targeting, geo-fencing and programmatic technology means advertisers are now able to reach a consumer right down to the building he or she is in and serve ads when and where it’s most relevant to them.

Leading location-based mobile advertising tech companies are allowing advertisers to draw borders around specific buildings and then match that back to signals from mobile devices.

This technology is helping to build up a huge real-world database of literally hundreds of millions of locations, each tagged with keywords such as ‘fast food lovers’ or ‘car showrooms’ that marketers can use to target specific groups of consumers with mobile ads.

If Niantic were to fully embrace these technologies, the targeting capabilities would become extremely sophisticated and the opportunities truly massive. And if used properly, these ads don’t have to scare Pokémon Go’s audience away.

GroupM hyper local targeting

An example by GroupM of hyper local targeting

In fact, they can even help to improve the overall user experience. With a ‘native’ approach to advertising – something programmatic is also set to revolutionise – brands can offer far more creative and relevant messages that fit with the overall content and user experience.

Advertisers have also been exploring the possibilities of augmented reality (AR) for some time, which will of course have big implications for a gaming platform like Pokémon Go.

One example is Net-A-Porter, which used augmented reality to reimagine window shopping. The online luxury fashion retailer created AR shopfronts in Paris, New York, London, Munich and Sydney to promote the new Karl Lagerfeld collection.

Whilst the storefront didn’t look out of the ordinary, viewing it through the Net-A-Porter Karl mobile app, meant shoppers saw videos of the catwalk, product information, 360-degree product models, and were given the ability to purchase the products.

Net-A-Porter shows us that any location could be an opportunity for brands to serve augmented ad experiences, with endless creative possibilities.

Net-a-Porter's Find Karl app

Net-a-Porter’s Find Karl app

As the technology continues to advance, we might even have brands creating their own Pokémon-themed characters or features that use programmatic technology to blend with and ultimately become part of the game, offering targeted e-vouchers and other incentives.

As long as advertisers learn the lessons behind the rise of ad-blockers and create adverts that blend with the experience rather than disrupt it, digital advertising absolutely has a place in the gaming revolution Niantic is leading.

So, if you think Pokémon Go is big now, prepare yourself for the much bigger opportunities that are only just emerging. A programmatically-enhanced Pokémon experience could be coming to a location near you.

Rick Mulia is managing director JAPAC at Rubicon Project


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