MOBILE MARKETING USING A LOCATION BASED SERVICE, E-book, do posegregowania
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MOBILE MARKETING USING A LOCATION BASED
SERVICE
Christopher Ververidis and George C. Polyzos
Mobile Multimedia Laboratory
Department of Informatics
Athens University of Economics and Business
10434 Athens, Greece
chris@aueb.gr
,
polyzos@aueb.gr
ABSTRACT
Considering the recent convergence of computing and telecommunications technologies with the
tremendous success of the Internet, the World Wide Web, and Mobile Communications, the next step is
expected to be the Mobile Web. The main promise of the Mobile Web is to satisfy user needs for
anywhere, anytime access to information and services, including Location Based Services (LBS). This
paper presents an innovative LBS service applicable to the Mobile Marketing industry sector. We
describe the architecture of the information system supporting the proposed service and a software
prototype we implemented using a simulation environment for providing location information. The
technologies adopted for this design are based on open standards and have successfully met the
requirements of scalability and autonomy. Then, we propose and describe a business model for this
service. Emphasis is given on the participating entities, their roles and the interactions among them.
Keywords: Mobile Advertising, Location Based Services, Business Model, System Implementation
1. INTRODUCTION
Advances in wireless communications and information technology have made the Mobile Web a reality.
The Mobile Web is the response to the need for anytime, anywhere access to information and services.
Many wireless applications have already been deployed and are available to customers via their mobile
phones and wirelessly connected PDAs. However, it seems that everyone is still looking for the “killer”
wireless application. One such direction points to Location Based Services, which we discuss below.
The remainder of this paper is organised as follows. In the second section we provide basic definitions
associated with Location Based Services (LBS), we describe the evolution path of such services and
provide a brief market analysis. In the third section we present our motivation for examining such
services and we give an overview of our proposed service for the mobile marketing sector. In the fourth
section the technical aspects of the system which supports the proposed service are presented in detail.
In the fifth section a possible business model is proposed. Finally, in the sixth section we provide our
conclusions and directions for future work.
2. BASIC DEFINITIONS & MARKET ANALYSIS
Location Based Services are services, which are enhanced with and depend on information about a
mobile station’s position. This kind of information has no meaning if it is presented as is. It has to be
correlated with some types of services. Location Based Services take up the role to supply the user of
these services with customised information according to his/her position.
In 2000 Gravitate Inc. has published a white paper which (correctly to our opinion) identifies three
evolution steps for Location Based Services [3]. The first generation refers to services where the
subscriber has to manually give his position information to the system. The second generation (existing
services) refers to location services where the position of the subscriber is automatically discovered but
with little accuracy. Finally, the third generation refers to services where the position of the subscriber is
automatically discovered with accuracy and which have the intelligence to inform or warn the
subscriber about events depending on his position (the subscriber doesn’t have to initiate the service, the
initiation depends on triggers according to his/her preferences).
2.1 Categories of Location Based Services
The GSM Alliance Services Working Group [11] has defined the following types of Location
Based Services:
•
Emergency Services
Emergency Alert Services
•
Home-Zone Billing
•
Fleet Management
•
Asset Management
•
Person Tracking
•
Pet Tracking
•
Traffic Congestion Reporting
•
•
Routing to Nearest Commercial Enterprise
•
Roadside Assistance
•
Navigation
•
City Sightseeing
•
Localised Advertising
Mobile Yellow Pages
•
Network Planning
•
Dynamic Network Control
•
2.2 Driving Forces for LBS
Market Forces
Recent market researches (e.g. [12]) showed that consumers in Europe are ready and willing to pay for
Location Based Services. Some indicative findings say that mobile subscribers would consider even
changing mobile phone operator in order to gain access to location based services and pay up to 16
Euros as a monthly fee for these services. In the U.S mobile subscribes would pay as much as 50
Dollars to have GPS or other location technology built into a cellular phone, according to similar market
research [9]. Some critical success factors for the adoption of LBS, as identified by these researches,
seem to be the following:
•
Protection of mobile user privacy
•
Easiness of usage
Non-intrusive way of LBS operation
Competition forces
Having established large customer bases, Cellular Service Provider will seek new ways to ensure
customer loyalty by offering new types of services. Location Based Services are the most promising
type of theses services, also called value added services. Some of the advantages for the Cellular
Service Provider who offers Location Based Services are:
•
•
Innovative service provision attracts new customers and enhances existing customer’s loyalty to the
provider.
•
Revenue increase due to traffic generated by the use of such services.
Capability to introduce new revenue streams through deals with third party companies (which
specialise in LBS implementation and/or provision), in order to sell to these companies user
location information.
Technology forces
The first location based services are expected or are already offered to mobile phone users via WAP or
SMS. Every GSM mobile phone supports the SMS feature and there are many that also support WAP.
The cost for a WAP enabled phone is under $80. This means that many customers can instantly make
use of the location services provided. In addition the evolution from GSM to GPRS, which means a
significant increase in the available bandwidth for data communication over mobile phones (from
9.6Kbps to 115Kbps) will also assist the provision of location based services that in many cases can be
bandwidth demanding. Finally new type of phones such as media phones and communicators are slowly
entering the market giving greater capabilities for displaying information (e.g. user interfaces enhanced
with photos, buttons and not only text).
Regulatory forces
In USA the Federal Communications Commission has issued a directive requiring the identification of
the geographical origin of an emergency call made by a mobile phone user. According to this directive,
operators should be able to provide location information for every mobile subscriber, who makes an
emergency call, with accuracy of 125 meters for 67% of the time [8]. The European Union is expected
to produce a similar directive by the end of 2002.
•
3. MOTIVATION AND SERVICE OVERVIEW
3.1 Mobile Advertising
The proposed service belongs to the mobile advertising category. This category of LBS involves the
provision of location aware advertising messages to cellular subscribers. Mobile advertising can be
considered as a part of mobile commerce. It is an integral part of mobile marketing.
Mobile marketing can be described as all the activities required to communicate with the customer
through the use of mobile devices in order to promote the selling of products or services and the
provision of information about these products and services [10]. There are many optimistic predictions
about what we can expect in the future from mobile marketing. Some of these predictions are the
following [10]:
•
From 2003 to 2005, analysts predict that mobile marketing as an industry sector will grow from 4
billion dollars to 16 billion dollars, serving over 500 million users world-wide (Chart 1, Source:
Ovum Research Ltd.).
•
Location aware advertising messages are expected to create 5 to 10 times higher click-through rates
compared to Internet advertising messages. (Source: BWCS Consulting and Communications
Services Inc.)
•
By 2005 the 33% of a Cellular Service Provider’s revenue will be coming from advertising and
from payments and commissions from mobile commerce activities.(Source: BWCS Consulting and
Communications Services Inc.)
Considering all these predictions as well as the history of advertising in other mediums like television
and Internet, it would be quite realistic to say that advertising is going to play a significant role in the
mobile web too. With the help of Location Based Services advertising companies can now provide truly
location aware messages to the customer. This fact gives for the first time the opportunity to reach
consumers with highly customised promotions and advertisements, which depend on the location of the
consumer.
PREDICTIONS FOR THE MOBILE MARKETING INDUSTRY
18
16
14
12
10
8
6
Total
4
Middle East & Africa
2
Latin America & Carribean
No r t h A m e r ica
2000
Asia - Pacific
2002
Europe
2003
2005
Chart 1: Worldwide Mobile Marketing Industry Predictions
3.2 The Proposed Service
The proposed LBS belongs to the category of Information Services and is about providing users with
advertising messages. Mobile Advertising is an integral part of Mobile Commerce and, to be more
accurate, of Mobile Marketing. The service operates in a way similar to directory services. To be more
precise, there is a distributed information base storing data about product promotions offered by every
supermarket in a given area where the service is provided. A user can search for promotions selecting
the product categories he is interested in. The service returns all the available promotions offered by
nearby supermarkets. The information system supporting the service described above has the following
characteristics:
•
The service is accessible through the WAP protocol. This means that the complexity and
intelligence of the service is managed by a web server and not by a stand-alone application on the
user’s device.
•
Users are located by the system at the level of a sector of a telecommunication’s cell by using the
CGI (Cell Global Identity) method. It is the simplest positioning method but can support efficiently
the above service given the small size of the cells in urban areas.
The information about available supermarkets and product promotions is stored in a Directory
Information Tree, which is accessed through the Lightweight Directory Access Protocol (LDAP) .
The information model used is hierarchical and is mainly used for search/read purposes than write
purposes. The LDAP protocol is used for high-speed access to this kind of information. It also has
valuable distribution capabilities (different servers store different parts of information), thus
offering scalability to the system. The availability is also increased as there is no single point where
the information is stored, the failure of which would mean the failure of the whole service.
The above system has been implemented in simulation environment but can also be tested against real-
world conditions using available telecommunication network’s infrastructure (telecommunications
network with positioning capabilities) because it is based on well defined industry standards.
•
4. SYSTEM ARCHITECTURE
4.1 The System
During the design of information systems that support Location Based Services, emphasis is given to
scalability, distribution and interoperability through the use of well-documented flexible ontologies and
broadly accepted information access protocols [2][5]. Scalability and distribution refers to the capability
of a system to expand providing support for more users and also to the capability of autonomous
management of separate parts of the available information. The information access protocols, when
standardised, give the opportunity to the system designer to use already well-defined interfaces. The
ontologies used to describe the available information should be based on standards, which allow the
easy expansion and management of the information (e.g. XML-like ontologies). Our approach for the
architectural design of the proposed system is based on the above principles.
We will now thoroughly describe the operation of the proposed system (shown in figure 1). The user
communicates with a Web Server over the WAP protocol through a WAP Gateway. The information
which is sent to the Web Server upon service initiation is the user’s id, password and telephone number
(MSDN). All this information is used by the system for authentication purposes.
In order for the Web Server to grand user access, the information is sent to the Location Server. If the
user is in the access lists of the Location Server then access is granted and the user’s current position is
recorded and sent back to the Web Server. The Web Server informs the user for successful sign in and
allows the user to select the product categories in which he is interested. Upon user selection the Web
Server communicates with the LDAP Server in order to create a list with all the available super markets
located near the user. If there is no supermarket located at the cell-sector in which the user is located
then the two adjacent sectors are searched. If no supermarket is found there either, then the system
returns an appropriate message to the user. But if supermarkets (at least one) are found then the Web
Server returns their credentials and addresses. The user by selecting a supermarket can be informed for
available promotions for products (belonging to the categories he has already chosen) offered by that
certain supermarket.
LOCATION
SERVER
CENTRAL LDAP SERVER
SECONDARY
LDAP
SERVERS
BTS
LDAP
BTS
PLMN
BTS
LDAP Requests/
Queries
LDAP
Responses
WAP
GATEWAY
INTERNET
WEB SERVER
HTTP Req
ue
s
ts
LINES
Network
Interconnection
WM
L
Responses
ASP pages
Dynamic WML pages
Communication
Figure 1: System Architecture
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