I localize, I advertise and I create effect? A study on the Perceived Ad Intrusiveness of Location Based Advertising within a virtual supermarket

ARIEF ERNST HOHN, PAUL KETELAAR, VASSILIS-JAVED KHAN, KOOS NUIJTEN & MARNIX VAN GISBERGEN I localize, I advertise and I create effect? A study on the Perceived Ad Intrusiveness of Location Based Advertising within a virtual supermarket Advertisers are looking for new ways to deal with ad avoidance. Location Based Advertising (LBA) increasingly presents itself as a feasible solution. LBA serves customers context-congruent ads on their mobile device based on its location. Although LBA has captured the attention of academics, there is very little in situ data regarding the effectiveness of LBA due to practical and methodical complications. In this study we present a solution: we reconstruct the user experience of LBA using a virtual reality setup. We study the perceived ad intrusiveness of context-(in)congruent mobile advertisements within a virtual supermarket by conducting a between-subjects experiment among Dutch citizens (n=53). The results show that LBA tends to be perceived as less intrusive than non-LBA. Consequently consumers develop more positive attitudes and are more likely to use LBA and buy due to LBA. This outcome should encourage marketers to adopt LBA as a valuable marketing tool.