The rising pervasiveness of mobile commerce has prompted firms to rapidly leverage mobile technologies to foster business‐to‐consumer connections. Firms send individuals mobile messages to promote their products and personalize the message content to make it more relevant to individual consumers. An important factor in mobile personalization is location. This research examines the effects of location personalization on individuals' intention to use mobile services. We draw on motivational theories to identify two groups of variables. One group includes features of location personalization that intrinsically motivate an individual to use a service, whereas the other group includes features that extrinsically motivate an individual to use a service. We examine how individuals' initial perceptions of mobile services influence the development of intrinsic and extrinsic motivations. Perceived novelty and perceived community‐based involvement belong to the former group of variables, while perceived location accuracy and perceived location precision belong to the latter. We also examine how intrinsic and extrinsic motivations formed at an early stage of use influence individuals’ intention to use mobile services in the long run. We developed eight hypotheses to explore these dimensions. Through a four‐week study, we found that when individuals first interacted with location‐based personalized services, they were driven by both intrinsic and extrinsic motivations. After a few weeks of interaction, the extrinsic motivation formed at the early stage of use proved to be less important in retaining users' interest. This research provides empirical evidence of the effectiveness of location personalization and helps firms understand and quantify new mobile commerce opportunities. It also sheds light on personalization studies by examining the role of location in personalization and explores factors that not only attract individuals to mobile services but also keep them engaged in the services in the long term.
