The Wall Street Journal broke news that Apple's iPhones store location data even when users have location services turned off. Reports indicate that Google is doing something similar. While local mobile marketing is still an invaluable way to reach out to nearby consumers, the controversy surrounding smartphone location tracking may mean marketers should think carefully about delivering ads that will make consumers feel they are being watched.

The location data collection has struck a nerve with many smartphone owners concerned about privacy. A Google Realtime search reveals that online social users have been taking to the web to comment on Apple and location data nearly every minute since news of “Locationgate” first broke last week.

Google has said that its location data is not tracking specific individuals. Steve Jobs has also spoken out, saying that Apple does not track and store users' locations. Business Insider quotes Jobs as saying, “We don't track anyone. The info circulating around is false.”

Local mobile marketers will want to see how the Apple/Google Locationgate scandal plays out and plan campaigns accordingly. Local SEO campaigns that can attract organic clicks from on-the-go shoppers may be a good way to draw foot traffic without making consumers feel their privacy is being infringed upon (and notably, mobile searches for nearby stores are on the rise).

When planning other local mobile campaigns, marketers should consider that consumers are increasingly conscious of privacy issues related to using mobile devices. As Nielsen reports, the majority of mobile app users across demographics cite privacy as a concern.