DDi - April/May 2011 - (Page 34)

34 M U L T I C H A N N E L R E T A I L Shopping for kicks GPS technology bridges the physical and digital retail experiences By Janet Groeber f getting customers in the door is job one for retailers, then why not pay them? That’s the thinking behind shopkick, a location-based smartphone shopping application that marries geo-location (GPS) technology with loyalty and in-store discount strategies, plus elements of gaming. Palo Alto, Calif.-based Shopkick Inc. makes a point of noting that its shopkick I application is not a social check-in app like Foursquare or Gowalla, but a way to help customers bridge the physical and digital shopping experiences. Customers with the shopkick app can accumulate loyalty points (called “kickbucks”) by visiting a store, scanning a bar code or trying on certain items—whatever speciﬁc behavior the participating retailer wants to reward. Once the customer is inside the store, the retailer can choose to offer additional incentives, such as bonus points on speciﬁc days or dayparts to increase trafﬁc. Kickbucks can be redeemed for gift cards or other prizes, or for charitable donations and Facebook credits. Shoppers can open the app to see a list of nearby participating stores they can enter and learn the number of kickbucks each offers. Debuting in August 2010 with a live demo in New York, Shopkick Inc. recently told The Wall Street Journal it had attracted 750,000 users since its debut and signed Best Buy, Crate & Barrel, Macy’s, Sports Authority and Target (about 1,100 individual locations) to its client roster. Shopkick works directly with retailers to provide in-store rewards. Macy’s, for example, has an ongoing bonus offer for shopkick users (100 extra kickbucks) if they visit a counter to try a featured fragrance. Retailers pay Shopkick to be included in the app and featured in special promotions. Shopkick has also been working with consumer product manufacturers, including Kraft and Procter & Gamble, to offer smaller rewards for checking in and scanning products at 230,000 retail locations. It works this way: the shopkick app, when open on a smartphone using Google’s Android operating system or on an iPhone, can detect a signal emitted from signal transmitter devices (about the size of a brick) located in the participating store. Start-up costs are fairly low, according to the company. Each device runs about $100 and requires an electrical outlet. In addition to the cost of each transmitter, retailers pay Shopkick a small fee for each kickbuck they hand out. And if a consumer buys an item after using the app, Shopkick gets a percentage of that purchase price. Shopkick says its location detection is more precise than existing GPS technology—which can only tell if a shopper is in the general area of a store—making Shopkick’s technology suited for malls and shopping centers. (Traditional GPS location-based services require shoppers to “check in” and are only accurate within one or two blocks or don’t work within centers.) Although location-based cellphone marketing is in its infancy, Shopkick Co-Founder and CEO Cyriac Roeding says, “Retailers and businesses will continue to jump on board, because their No. 1 problem is foot trafﬁc.” Shopkick is the physical-world equivalent of Google’s online pay-per-click model, he notes. “[A lot of] CMOs at major corporations are now willing to put dollars there.” To e-mail this article, visit www.ddionline.com/magazine. | April/May 2011 www.ddionline.com http://www.ddionline.com/magazine http://www.ddionline.com

Table of Contents for the Digital Edition of DDi - April/May 2011

Ddi - April/may 2011
Contents
From the Editor
From the Show Director
Newsworthy
Shopper Insights
Greentailing
Editor's Choice
Design Snapshot
Channel Focus: Footwear
Multichannel Retail Section
Digital Engagement
Shopping for Kicks
Mobile Retailing
Right Light
Product Spotlight
Global Shop
Booth Winners
Speaker Sessions
Trends
Products
EuroShop Products
Calendar
Advertisers
Classifieds
Think Tank

DDi - April/May 2011