Aim/Purpose: This study focuses on two targeting strategies of out-store Location-Based Mobile Advertising (LBMA): the geo-fencing strategy (i.e., targeting customers who are near the focal store) and the geo-conquesting strategy (i.e., targeting those who are near competitors’ stores to visit the focal store). To the authors’ knowledge, no previous studies have compared the perceived intrusiveness of advertisements (ads) in geo-fencing and geo-conquesting settings, despite the accumulating literature on out-store LBMA. Hence, the aim of this study is to determine which targeting strategy is more effective in terms of reducing the perception of ads’ intrusiveness and increasing positive customers’ attitudes and purchase intention.
Background: The intrusive nature of LBMA is perceived negatively by some customers, impacting their attitudes toward the ad, purchase intention, and even their perception of the brand. Therefore, identifying the targeting strategy under which ads are perceived as less intrusive is essential. Additionally, brick-and-mortar clothing stores in Jordan are facing challenges due to the rise of online shopping and increased competition from nearby stores. Thus, examining geo-fencing and geo-conquesting might tackle these challenges and encourage local clothing retailers to adopt these strategies.
Methodology: A quantitative method was used in this study. A between-subjects experimental design was used to collect the data using a scenario-based survey distributed to Jordanians aged 18 to 45. A total of 531 responses were collected. After excluding those who do not belong to the targeted age group and those who did not pass the manipulation check, 406 responses were analyzed using the Statistical Package for the Social Sciences (SPSS) software version 28 and the Analysis of Moment Structures (AMOS) software version 26 to conduct Structural Equation Modeling (SEM).
Contribution: This work offers valuable contributions by investigating the impact of the perceived intrusiveness of ads on purchase intention in the contexts of geo-fencing and geo-conquesting, which has not been studied before. Additionally, it fills a gap by examining this phenomenon in Jordan, a developing country in which attitudes toward LBMA have not been previously explored.
Findings: The results revealed that location-based mobile ads sent under a geo-fencing strategy are perceived as less intrusive than those sent under a geo-conquesting strategy. In addition, customers’ attitudes fully mediate the relationship between intrusiveness and purchase intention only under the geo-fencing strategy. Ultimately, neither of the strategies is more effective in terms of increasing positive customer attitudes and purchase intentions in the context of clothing retail stores in Jordan.
Recommendations for Practitioners: Clothing retailers in Jordan should consider adopting geo-fencing and geo-conquesting strategies to boost purchase intentions and tackle industry challenges. Additionally, to increase purchase intentions with geo-fencing, practitioners should focus on fostering positive customer attitudes toward ads, as simply perceiving them as less intrusive is not sufficient to drive purchase intention without the mediating effect of positive attitudes.
Recommendation for Researchers: This research is crucial for academics and researchers as geolocation technology and LBMA are expected to advance significantly in the future. Researchers can investigate this topic through a randomized field experiment, followed by a research questionnaire to collect data from a real-world setting.
Impact on Society: Utilizing LBMA is essential for local clothing retail stores that are trying to effectively reach and connect with their customers because searching the Internet for local goods and services is done primarily on mobile devices. Indeed, this study revealed that customers in both settings (i.e., geo-fencing and geo-conquesting) reported a high intention to visit the promoting store and to purchase from the advertised product category.
Future Research: Future research can apply this topic to different industries and cultural contexts, as the results may vary across industries and regions. Moreover, future research could build on this study by investigating additional constructs, such as product category involvement, customization, and content type of the message (e.g., informative, entertaining).
