Apple may have lost more than its pristine product rep upon releasing its bungled Maps app last month. CEO Tim Cook’s mea culpa pointed iPhone owners to alternatives, among them crowdsourced traffic app Waze. In the days after getting the Apple plug, Waze was adding 100,000 users a day and now has 28 million consumers using it for turn-by-turn navigation and to report traffic conditions, said Di-Ann Eisnor, Waze’s vp of platforms and partnerships.
Waze will bank on that growing user base next month when it launches its U.S. ad platform on Nov. 7. Following in the footsteps of other startups like Foursquare and Tumblr, the Israel-based Waze is focused on creating “native” ad opportunities. “We never once considered putting banners into the app,” Eisnor said.
Instead, Waze allows brands to place virtual coupons onto its maps, looking to entice users to drive to a nearby brick-and-mortar location. To date, the company has already inked 250 advertisers in Israel, including McDonald’s. Zipcar and Best Buy have recently signed on in the U.S., along with multiple gas and convenience store chains.
Waze claims it can even measure ad-driven store visits. “We make sure we’re good at measuring all the way to arrival,” Eisnor said. That sort of ROI-driven approach should sway marketers averse to anything that departs from the traditional way of buying ads, said BIA/Kelsey senior analyst Michael Boland.
Ironically one barrier to getting advertisers on board could be location. Specifically, the fact that Waze is miles from Madison Avenue. Eisnor met with several New York agencies recently and said she found herself at times in a room with several people who hadn’t heard of Waze. “They know Foursquare because it’s basically developed for New Yorkers. Ours is for commuters,” she said.
Indeed, BIA/Kelsey often surveys advertiser behavior, and Boland said a leading indicator of where buyers will spend their money is what they use as consumers. Since media buyers are centralized in an urban environment, “it might take longer for them to see value in navigation-based advertising that involves driving somewhere, even though that’s prevalent in rural areas,” Boland said.
But by the time they do find that value, Google may have finally released its own maps app for iOS. Not only would Google likely runs ads within its new app, as it does in the Android version, but that offering would potentially dwarf Waze’s scale. In that case, Waze would need to rely on the active nature of its user base. Eisnor said the average Waze user employs the app 440 minutes a month over 11 separate drives.
That still may not be enough to fend off Google, but Waze isn’t only relying on Apple’s mistakes and Google’s absence to acquire new users. The company’s working with a number of car manufacturers and plans to roll out its first in-car app next year, Eisnor said.