BrainTrust Query: Supercharged Checkins
By David Dorf
Through a special arrangement, presented here for discussion
is an excerpt from a current article from Insight-Driven Retailing Blog.
Location-based
social networks are the latest fad to hit mobile phones. Foursquare seems to
be getting most of the attention, even though MyTown, Brightkite and Loopt
actually have more users. The concept has mobile phone owners using GPS to “checkin” to
establishments, including restaurants and retail stores. Checkins are rewarded
differently by each system, but some benefits include getting location information
(maps, hours, description), reviews, find nearby friends, or receiving coupons.
There’s also the game angle for those who like to collect points, unlock rewards,
and gain status.
Retailers would like to know when someone shows up at a store.
It’s a good time to entice them with an offer, or better yet attract them from
a nearby competitor. CardStar, the mobile application that consolidates all
your loyalty cards, is now automatically performing a checkin via Foursquare
when you use your loyalty card. That marriage makes perfect sense.
Now SCVNGR
(pronounced “scavenger”) is taking checkins to the next level. Retailers create
challenges for users to perform in exchange for rewards. For example, a retailer
may provide a coupon to anyone that checks into two different store locations
on the same day. Users can earn points for checkins, comments, and photos they
take of the store. Then, when a certain point threshold is reached, they get
a reward.
The flexibility
of the program allows retailers to tailor the program to influence behavior
better than just a simple checkin. In late July, SCVNGR users were able to
earn a $10 coupon at Journeys 800+ stores by winning challenges and earning
points. These activities are meant to engage customers and have them get to
know the shoe store.
Seems to me that supercharged checkins make a nice addition to loyalty
programs.
Discussion Questions:Â What do you think of the potential of “checkins” tied
to location-based social networks such as Foursquare? In what other ways should
retailers explore capitalizing on location-based networks?
Anything that can make shopping fun is welcome in the discount mentality of retail in 2010. Smart retailers can craft challenges that give them customer information in exchange for added value–so much better than another Val-Pak mailing.
This is only the beginning! There are so many opportunities for mobile technology, speeding up our pace and increasing creative uses along with customer service.
Location-based social networks can be great for a retailer, but the trick is using them in a way that makes sense for the retailer and the customer. Since the application is fairly new, companies need to do their research and spend some time thinking how best to implement the technology to benefit their business and customer relations.
This is another creative use of technology to enhance loyalty. It will attract some consumers, but it’s clearly not for everybody. Participation will be generational, and that’s not necessarily a bad thing. Younger consumers are the heavy shoppers of tomorrow as Boomers trudge toward the checkout lane.
When someone I like contacts me directly I’m happy. When many other people contact me with perceivably self-directed messages I’m not happy.
East is East and West is West but times are changing and so are directions. So there’s a large current opportunity in Supercharged Checkins…at least until a better mousetrap is conceived for the searching souls in the marketplace.
I’ve not used any of the location-based checkin services, because in general I don’t believe anyone really cares where anyone else is. But the model of augmenting loyalty programs with points is a shopper-centric value-add that makes sense for those seeking deals. What I’d like to see is the model scaled to provide an additional “reach” element, where a check-in at a retail location provides a benefit for a shopper to pass along a value found in a store to another friend/shopper.
If I have to be subjected to a post that tells me where someone is, why not make an extension option available? If my friend checks in at Dunkin’ Donuts (for instance) in the morning, could an offer be uploaded that the visitor could then post, making it available to the first five friends who log in and download it? That kind of program has dual appeal; the retailer gains reach and potentially more traffic, and the shopper gains the deal on a great cup of coffee!
SCVNGR is a cool example of where location based marketing can go with fun, fully-involved consumer participation. SCVNGR enables companies and organizations to design their own scavenger hunts, sending clues to participants via mobile phones. They’ve done well on college campuses (see list here) and brands are starting to pick up on this form of engagement.
The potential for location-based marketing is tremendous and I think we’re fast approaching the end of the “shiny-object” phase of its growth curve.
Foursquare introduced the concept as more of game than anything else but we’re quickly seeing the technology commercializing with the advent of services like Shopkick and SCVNGR.
I think the tipping point will come once major mainstream rewards platforms like Air Miles adopt location-based technology.
There’s no question in my mind however, that LBS will become a very key aspect of every major retailers marketing plan.
For consumers who like this kind of thing, it is a huge marketing opportunity. I would suspect, though, that the market for this would be overwhelmingly male–the stalkability factor for women is significant.
I just read a great article about a CRM conference in New York happening, during which an analyst proclaims the future of CRM will be about location, but that the fad around “check in” apps will not yield significant benefits because the value here will depend on offer relevancy, which can only happen if retailers can drive mobile interactions based on analytics informed with customer history, demographics and other data sources.
I think “checkins” are an interesting engagement tactic that retailers should look into if not participate in, but there should probably not be a great expectation of significant value given the disconnect around relevancy.
Making shopping fun would reverse a trend for consumers. Engaging consumers is always a good thing. Attracting consumers to your location is excellent. Identifying valuable consumers and offering them personalized offers is a great way to reward and encourage loyalty. What group of consumers uses and/or responds to these notices on mobile devices? If those are your consumers, just do it.
In a few years, I suspect we’ll see the “check-in” as a quaint early step on the way to a lasting mobile retail engagement model.
Here is yet another classic instance of a novel consumer interaction platform in search of commercial applications. These “location club” apps remind me of Twitter at its earliest stages. They feel like games right now, but one may succeed to the extent that it can aggregate a committed audience of interest to marketers.
In addition to linking with some loyalty programs, I see potential to combine these “where am I now?” activities with GPS-based way-finding tools like Layar’s augmented reality browser (which overlays “captions” on an image of a local street scene). Integration with social media sites like Facebook must inevitably follow.
The two major caveats of location-based apps are already touched on by fellow BrainTruster’s: One, interest will skew strongly toward younger users who are naturally more open to try mobile apps. Two, there is a significant personal privacy or even safety risk to the individual who broadcasts his or her location.
I’m a realist about personal privacy, and not hung up on keeping secrets, but I won’t tip the burglary network when I’m away from home.
It’s great to see this is finally going mainstream. Around the globe, like in Tokyo where GPS has been used for a couple years now to not only identify when a customer enters a retailer, but also on a social basis where (get this!) when two people who are registered on a dating website, are walking down the street and the have common interests, their phones call each other when they are within 100 meters of each other. Imagine what retailers could do with this community! A coffee shop adds a coupon to the phone message to invite the two people to stop in the store!
The geolocation software opportunities are endless. It allows retailers and brands to take advantage of the gaming mentality that permeates a lot of our lives, and use this to further their brand message, and to make shopping more interesting.
But it is not enough to simply be a part of the platform. The quality of the engagement is what is most important, and most compelling to the end user. Ask people who use these check-in platforms; they don’t simply want to be noticed that they are there, they want to be rewarded, and in fact be appreciated. The software allows consumers to be identified, what retailers do with this information is what is most important. To date, we have seen few retailers really take advantage of the opportunities that exist for them
Given time, we are certain that retailers will start to “get it,” and will gain some great insights into customer loyalty and they adopt the strategies further.
Not to be a buzz-kill here, but…our credit card clients have experimented with rewards programs, merchant loyalty coalitions, etc., for ages. Based on personal experience both planning and analyzing these schemes, I would expect location-specific mobile programs to have a modest initial impact as people investigate the buzz, and then to fade quickly into the woodwork of some other scheme or fall away altogether.
The reasons are many. Not everyone is into collecting points…as many have said here, the reward has to be worth the effort. Not everyone wants to broadcast their location…privacy is a huge issue. Unlike other points-based schemes that reward shopping behaviors without promoting an actual meet-up–the risks of promoting face-to-face encounters are serious. Who gets sued when a ‘meet-up’ goes bad? Is it the merchant sponsor, the geo-location ‘game’; both? This is a court case waiting to happen. Finally, who wants their cell phone sounding constant alarms about nearby specials when passing by on the street? Might be cute during a casual stroll, less so when you’re rushing to make a meeting. How about when you’re whizzing along on the freeway? Would you race to the nearest exit, tires screeching and cars honking angrily around you, to get that 20% off at Best Buy? Good grief.
Geo-location is the new toy and it will have its place in the reward spectrum, I’m just not sold on check-in applications as big winners.
Points for visiting the store twice! This is like bringing second life to real life. Definitely, shopping would be more fun with this. Apart from targeted couponing and discounts, this could be leveraged to engage with customers while they are waiting in the checkout line.
Some interactive shopping games can give insights into the shopping behaviour of the customer. It can also be tool to measure effectiveness of a display/promotions. Games like spot the product in store, guess the price or promotion and others can keep shoppers engaged in the queue, and at the same time since they have checked in, their behaviour through the game interface can be studied. This makes it a great tool to acquire shopper insights in the store.