This post was brought to you by YD Online.

Companies like Foursquare, Facebook and Yelp have started to put location-based technology to good use, but the mobile gaming market is just starting to scratch the surface on how to best incorporate location-based technology. By the end of 2011, iSuppli predicts that four out of every five cell phones will have integrated GPS which, coupled with increased mobile computing power, creates a huge market for location-based games.

If 2010 was the year location-based check-ins took off, the coming months will deliver even more sophisticated and varied location-based games. With these types of games just beginning to be developed, it’s worth looking at five trends that will guide the mobile gaming business and experience in a new direction.

1. Marketing: better deals for the user
To keep ad prices down and revenue up, highly targeted advertisements based on location are going to
show up as part of the gaming experience. Be it answering trivia questions for a discount code or battling
another customer for a better coupon, gaming and location-based marketing are going to form one
tightly integrated experience moving forward. More importantly, the experience will be more fluid, with
advertisements involving and encouraging the gaming experience rather than interrupting it as they do
now.

2. Social gaming: a new type of social network
With the integration of location, mobile gaming will no longer be limited to direct competitors (aka the
person next to you holding the controller) and will connect players across the globe. By leveraging
peoples’ location and social network connections, games will allow players to connect and play with
anyone in their city in addition to the people they actually consider friends. Effectively, each game will act
as its own social network, connecting everyone in an area through their own location-based protocols.

3. Real world interaction: get out and explore
The next wave of location-based games will not just incorporate locality; they will make location as
dynamic as the player. Yet another instance where marketing meets gaming, these types of apps will
direct players to certain places in their city to take a picture, record a video or perform an action and
upload it to compete with other gamers. Businesses will leverage these tactics to draw in existing and
new customers by engaging and entertaining them.

4. Local really means local: hyper-focused design
Location-based gaming goes beyond just using location for rank amongst a set of peers. It’s also about
setting and creating a realistic gaming experience. The slight curve of your street, the construction on the
building next door, these are all things that designers will be adding to games to make the experience as
realistic, personal and entertaining as possible. Designers know that presenting a layout that is familiar to
the gamer will make an emotional connection with them and keep them more interested in the game.

5. Gamification: making the mundane fun
Game developers will use location to implement gamification, transforming everyday activities into
things players can do via game dynamics for rewards. By adding gaming elements to real-world tasks
along with geo-location, everyday things like walking your dog or grocery shopping begin to entice
you to continuously stay inside the game’s ecosystem. Ultimately, this leads to greater exposure to
advertisements and increased frequency of return, more time spent in-app, viral spread, and higher user
ratings. Which, for some brands, are key metrics for measuring the success of their apps and marketing
campaigns.

This article was written by Jhung Soo Hong, YD Online’s managing director. YD Online is a global game developer and creator of GEO Hunters, a location-based role playing game and Angel’s Choice, the first mobile game for app discovery.