In a 2020 report published by Retail Touchpoints Magazine, “How COVID is Reshaping Omnichannel Operations,” it was found that retailers’ use of location-based technology and geographic information systems (GIS) had more than doubled in 2020 compared to 2019, rising from 10% to 23%. In addition, the use of branded mobile apps, which allow retailers to respond to shoppers’ location and movements in real time, also increased, from 18% to 25%. It was another indication of how the geospatial industry has grown. Location technology has moved from being a “useful” tool to an “indispensable” solution. It impacts everything from the customer experience to inventory to ecommerce and has become essential for buy online, pick up in-store (BOPIS) services.
Location Data Explodes
The explosion of location-based data comes as a result of the pervasive use of personal mobile devices, social networks, and IoT sensors. Many industry sectors, from retailers needing to find new revenue sources due to COVID as well as wireless providers seeking markets for 5G, are finding these data invaluable. However, the ability to purchase data with specific or custom areas of interest is challenging because of the volume and velocity by which these data are captured. Processing these data requires high-computing infrastructure or a managed service to do the same. Monetizing these data comes at the expense of developing the institutional knowledge required to understand the most effective benefits to consumers. What many companies fail to understand is that you cannot dissociate the technology from the expertise needed to capitalize on these data sources.
Location in Mainstream Business Computing
As consumers of information, we sometimes take for granted how often we use location-based information. Every day, Google Maps is one of the most heavily utilized websites providing directions, business location information and even terrain data. Your favorite weather app shows you a map of rain, snow and temperature. And retailers process online payments by first recognizing the address of customers through a “type-ahead” function that validates and verifies an address as a delivery point. In the background of all these apps is geospatial technology. Users of applications now assume that location and maps are just part of the way information is communicated. It is a level of expectation that did not exist just a few years ago. The consumerization of location-based information is accelerating the growth of geospatial technology across government and private industries alike.
The GAFAM Are Leading the Geospatial Revolution
It’s no longer the case that only niche geospatial software and data companies occupy this part of the tech sector. The largest global technology companies now comprise a significant part of the market. Google Maps and Google’s acquisition of Waymo and Waze is certainly an indication of its vision for location but it is not the only company to see the potential of location data. Microsoft was already dabbling with “globes” with Virtual Earth in 2003, a few years before Google Earth. Today, Microsoft has embedded the capability to query spatial primitives in SQL Spatial, launched Azure Maps, invested in high resolution digital cameras before they acquired Vexcel. In December 2020, Amazon Location Service was launched on AWS, partnering with Esri and HERE Technologies among others. Facebook, once again partnering with HERE Technologies, has allowed users to identify the location of posts and photos, and provided anonymized location data to non-profits for COVID research. Finally, Apple will use Apple Maps as an intrinsic part of their ability to eventually provide autonomous vehicles.
Although not considered part of the GAFAM tech group, Salesforce purchased MapAnything in April 2019, which has been renamed, Salesforce Maps. Salesforce’s acquisition of Tableau had already given it a foothold in geographic visualization and basic analysis and had embedded geocoding capabilities within its CRM platform years earlier.
These companies have understood the competitive advantage geospatial technology can provide, and thus accelerated merger and acquisition activity.
From Convenient to Indispensable
Some businesses rely extensively on location data. Naturally, geographically-based industries such as real estate and telecommunications have used location data for decades. But in the “gig” economy, without location data companies such as Uber, Airbnb, Lemonade, Doordash, Zillow and others simply don’t exist. They are so heavily dependent on current and accurate data that their business models must invest in superior sources. In addition, other industries, such as retail and insurance, are finding that geospatial models for site selection and risk assessment, respectively, are indispensable for right-sizing their business. In the case of insurers, price an insurance policy too high, and customers will go elsewhere; price too low and companies may be stuck with a high-risk customer. Getting it right depends on highly accurate data on the location and extent of perils that impact the underwriter’s ability to price effectively. As for the retailers, during the pandemic, quick service restaurants found it necessary to transition to a delivery-only based business, where taking the customer’s address location and routing drivers efficiently became a must in order to survive.
The awareness of the value of geospatial technology is trickling down from the professional with degrees in geographic information systems (GIS), to the business analyst, who uses business intelligence (BI) software such as Tableau and Cognos. Most BI tools have some element of geographic analysis capabilities. As such, these tools now provide functionalities that overlaps with those of the more robust GIS software on the market from companies like Esri and Precisely. It’s projected that the next million users of geographic information won’t know (or care) much about GIS software. It will be assumed that their tool for analytics will be able to perform spatial analysis.
So, as the technology becomes an indispensable tool, there will be more users in the market for both advanced functionality and accurate data.