Digital Gets Physical

In the great Facebook fan rush of 2009, Skittles stood out. The Wrigley brand was able to accumulate a staggering 3.6 million connections. This gave the brand an opportunity to message this audience — but not much more.

Last month, it decided to get real. Skittles kicked off “Mob the Rainbow,” a social media campaign that turns loose its virtual friends on the real world in service of fun challenges. To start, over 45,000 Skittles fans created Valentine’s Day cards for an unsuspecting traffic enforcement officer in San Francisco. Skittles filmed the encounter and posted it on Facebook, bringing the effort full circle from digital to physical back to digital. It led to another boost in Facebook fans, with nearly 500,000 added in a month.

The Skittles campaign is part of a shift in digital away from users merely sitting in front of computer screens to using new digital tools to affect behavior in the physical world. The growing sophistication of smartphones is driving the creation of these location-based services, which promise to morph the Web from a solitary experience to a ubiquitous connector in the real world.

This evolution has major implications for brands, giving them the possibility of tracking the success of digital campaigns to the store level and changing how they market to consumers.

“Most of the products we market are tangible, real-world products,” said Daniel Stein, CEO of EVB, the Skittles agency behind “Mob the Rainbow.” “Within social media, there are a lot of brands just talking to themselves.”

One of the most promising areas for this type of engagement is mobile. Location-based services were all the rage at South by Southwest last week. The current darlings of the space, Foursquare and Gowalla, squared off with competing parties and efforts to win over the festival’s early-adopter crowds. Both offer similar platforms, allowing users to “check in” to places to alert their friends and also reap virtual rewards.

Foursquare and Gowalla have attracted brand attention. Gowalla has hooked up with The Travel Channel to let fans of Food Wars check in at locations related to the show to earn virtual stamps. Foursquare has a raft of deals, including most recently one with Starbucks that rewards customers for checking into its stores.

The companies are not alone. Google has weighed in to the space with Google Latitude, which lets users opt in to have their friends know their whereabouts based on information from GPS satellites and cell towers. Local city guide Yelp now has a check-in provision, and Twitter last week activated a feature for users that allows them to easily share their locations.

“Location is going to be an embedded part of every experience,” said Ryan Sarver, director of platform at Twitter, during a SXSW panel on the subject. “Every application is going to have some location aspect to it.”

The fly in the ointment of these services is the looming question of user privacy. As the current mood in Washington casts a skeptical eye on behavioral advertising, location-based service presents a host of thorny challenges. The main problem is that, unlike behavioral data online, location services obviously cannot be anonymous without compromising their effectiveness. (See also: “Policing the Online Ad Market”)

“That’s really sensitive data,” said Steve Lee, group product manager at Google. “Important things like location history are opt in.”

Assuming the privacy challenges can be overcome, there are any number of possibilities to marrying the real world with digital data. Augmented reality, which until now has mostly been used for experiences in front of Webcams, is making the leap to mobile phones and elsewhere. General Motors, for example, has begun testing a windshield that uses augmented reality to display directional information, like the location of a building or the edges of a road in poor weather conditions. Marketers will see many more possibilities open up as the technology improves, according to Matthew Szymczyk, CEO at Zugara, which has created an augmented reality shopping application to let people try on clothes virtually.