How location-based advertising elicits in-store purchase

• Published in: The Journal of services marketing Vol. 33; no. 4; pp. 380 - 395
• Main Authors: Shieh, Chih-Hui, Xu, Yingzi, Ling, I-Ling
• Format: Journal Article
• Language: English
• Published: Santa Barbara Emerald Publishing Limited 18.09.2019; Emerald Group Publishing Limited
• Subjects: Consciousness; Consent; Consumer behavior; Consumers; Data analysis; Location based services; Marketing; Mobile advertising; Perceptions; Personal information; Privacy; Purchase intention; Retail stores; Studies; Time-consciousness; Location-based advertising; Click intention; Decoy message
• ISSN: 0887-6045; 2054-1651; 0887-6045
• DOI: 10.1108/JSM-03-2018-0083

Purpose This paper aims to investigate how location-based advertising (LBA) elicits in-store purchase intention. To deepen the understanding of LBA’s effect on consumers’ purchase decision, the research examines the role of consumers’ time consciousness in click intention in pull or opt-out LBA approaches. The study also explores how consumers react to LBA with an asymmetric dominance decoy versus a compromise decoy message. Design/methodology/approach Two field experiments were conducted, and a total of 363 volunteers within 3 km of a shopping mall participated. The participants were asked to turn on their global positioning system and then informed that a convenience store was planning to launch a mobile coupon subscription service. Data collected were analysed using analysis of variance, regression analysis, bootstrapping and spotlight tests. Findings The results demonstrate that consumers had a higher intention to click pull LBA than to click opt-out push LBA. Consumers with high time-consciousness had greater click intentions for pull LBA than for opt-out push LBA. Consumers with low time-consciousness, however, showed no difference in click intention for either LBA approach. Further, click intention mediates the effect of LBA on in-store purchase intention, and the asymmetric dominance decoy message is a more powerful strategy for LBA to increase the likelihood of in-store purchase. Originality/value This research provides insight into location-based services marketing by revealing how time-consciousness and decoy promotional messages affect consumers’ reaction to LBA and in-store purchase intentions. The findings offer practical suggestions for retailers on how to reach and engage with consumers more effectively through the use of LBA.