Crassly speaking, that applies to all advertising to a certain degree. It's only a matter of when the gray area turns dark enough.

I'm not defending located advertising per se, but to me the rationale for doing located advertising would be to pull in the customer in the moment and vicinity, and with a tangible value proposition. Otherwise there's no point of doing that.

It would be rather distracting getting such messages while driving, and it would be hard to follow them without driving into a ditch. Speech would have solved that, but phone manufacturers have still not realized that's a good way of being in the know while driving.

So for practical reasons it sounds like it applies better to e.g. malls and air ports. When you are at an air port you are primarily worried about catching the flight, so to grab the attention of a passer-by this could be a nifty and very local way of achieving attention. Of course then we are talking Bluetooth rather than cell or GPS location.

Also, if you are a member of a retail brand you could get such messages when you are close to or in such a shop, instead of having to look up what is being rebated right now.

As you say, this could also hurt the brand, but where to draw the line? If you are a rather unknown player, this could be an inexpensive way of creating attention.

Another issue will be quality inventory. Wrote some posts about it here

http://mobileinc.co.uk/2009/12/why-location-bas...

http://mobileinc.co.uk/2009/11/mobile-location-... (in response to an article on Mobhappy)

Another problem is that people aren't really thinking creativitly around location based messaging yet, everything I see seems to be sell, sell, sell. But with a bit of thought some lovely stuff can be made, knowing someones location doesn't mean you have to push them something right then and there, some interesting things can be done with the data.

Gonna write a post with some ideas in the next week.

Send messages when you have something relevant to offer, not when someone is near your location.

What the bank realized was people don’t want to just randomly receive messages on their mobile devices. They want it to have immediate relevance with an offer that is actually worth something.

Starbucks knows this now. The North Face will realize it soon. What will happen is The North Face will spend time and money signing up their most loyal customers. Then, they will start to send out meaningless messages when these most loyal customers are near…resulting in one to many messages eventually. Then, this will cause these most loyal customers to opt out… All that money and time wasted.

What they really need to focus on is meaningful messages that have immediate relevance, regardless of the location of their loyal customers. Loyal customers that have trusted you with their cell numbers will travel for the right offer. No one wants their phones pinging every time they are near your store.