Shopkick: The Newest App for Mobile Marketing

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Tapping into the newest social media marketing strategy is Shopkick – a mobile marketing application available for iPhones.  Unlike Foursquare, which relies on your phone’s GPS to locate your phone (and you), shopkick sells a device allowing participating stores to use the radio signal produced by all cell phones to detect your phone when it comes into their store.

Shopkick: The Newest App for Mobile MarketingAfraid of Privacy Invasion?

Don’t be.  The app has to be open to check-in allowing YOU to control who “sees” you and who doesn’t.  And, participating stores give you rewards when you check-in in the form of kickbucks you collect and use for discounts on store products. Or, you can donate your kickbucks to a charity of your choosing.  So, just entering a store can give you or your favorite charity some tangible rewards — better than just collecting badges and bragging rights from Foursquare.

What do customers get from this marketing strategy?

Behaviors consistent with company goals get you more kickbucks — for instance, going into the dressing room might provide more kickbucks than entering the store, and just passing by the store might only give you a few kickbucks.  Thus, businesses can use these devices to support their marketing strategy through motivating consumers to explore more deeply within the store.

Kickbucks can be redeemed for discounts, gift cards, small products, or other rewards within the store, based on how participating retailers have structured their reward program. Consumer can also use the app to get information about nearby stores  who participate in the Shopkick program – currently a few major stores such as American Eagle, Best Buy, and Macy’s are using the program on a test basis in a few of their stores.  The mobile marketing program will likely spread, as users (like American Eagle) have been very positive and have plans to roll the product out to more of their stores.

Once in the store, customers will receive information regarding promotions, special events, or newly received merchandise, other interesting information the retailer might want customers to know about the store.

How does the marketing strategy work?

The GPS location system used by most mobile marketing companies is NOT good enough to pinpoint which store you’re in (this is for military purposes to disable the ability of terrorists or other enemies to pinpoint strikes on military or civilian targets).  So, Shopkick experimented until they hit on the radio signal as a means to differentiate between stores in a mall so the device only detects you when you’ve entered a participating store.   This marketing strategy allows the store to accurately determine who is entering their store.  The device sends out an inaudible ping and pairs with your phone to detect you entering the store (this is similar in principle to the pairing that occurs between your phone and your wireless headpiece).

How stores can optimize this marketing strategy

Multiple devices throughout the store, which is the common implementation of this marketing strategy, might allow businesses to know where customers go once they enter the store, how much time they spend there, and integrating information from Shopkick with sales information might be used to create a very powerful database of customer behavior to guide future marketing strategy decisions such as store layouts, merchandising, etc.

Data mining might also be employed with all this rich data to further support strategic decision making.

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