In its second-largest acquisition, Amazon buys the company for $970 million.
The retailers are the first to install Shopkick’s shopBeacon, which detects the Shopkick app on a shopper’s smartphone as she enters a store and sends her a push notification, for instance to remind her of items she’s liked or alert her to special offers.
American Eagle Outfitters Inc. and Macy’s Inc. are sending a jolt to the pockets and purses of shoppers who have the Shopkick app on their smartphones. The retailers are the first to install in their stores rewards app Shopkick’s latest mobile technology, called shopBeacon, that can detect the loyalty app on a shopper’s phone when she walks in a store, even if the app isn’t open, and send her personalized deals via push notifications, which typically trigger an alert tone and vibrate the phone.
American Eagle this month announced it deployed the technology in 100 of its stores, while Macy’s in November began a trial in two flagship stores.
“American Eagle Outfitters has always been an early adopter of cutting-edge technology, which is why we are partnering with Shopkick once again, in order to provide our customers with the best mobile shopping experience available today,” says Joe Megibow, the retailer’s senior vice president of omnichannel e-commerce. Because American Eagle already offers shoppers deals and rewards via the Shopkick app, he adds, the retailer was able to start sending customers personalized offers in its stores as soon as it installed the beacons.
ShopBeacon also can be used to detect a retailer’s app and send push messages through that app, as well, but American Eagle and Macy’s decided to start with the Shopkick app alone, Shopkick says.
Since 2010, Shopkick has offered a wireless transmitter that broadcasts a constant signal at an inaudible frequency in stores. That technology—which about 15 retailers use in 10,000 stores nationwide today, the company reports—requires that a shopper already have the app open on her device for the signal to recognize it and send her deals and rewards.
In contrast, shopBeacon, which uses a combination of the audio signal and Bluetooth Low Energy wireless networking technology available on most newer smartphones, detects the presence of the app on a shopper’s smartphone whether it’s open or not. A beacon is a Bluetooth Low Energy transmitter that a retailer can place anywhere in a store; the bigger a store, the more beacons required. Bluetooth Low Energy is a significant advance in Bluetooth wireless technology because it requires very little energy when left on 24/7, which is how most BLE-capable phones are set. Previously, Bluetooth when left on would be a drain on a smartphone’s battery.
“In mobile, the dirty secret is it’s hard to drive downloads, but much harder to drive repeat usage and get people to remember to use the app at the exact moment they enter the store,” says Alexis Rask, chief revenue officer at Shopkick. By ensuring customers with the mobile app remember to use it in stores, she says shopBeacon will allow retailers to have more influence over where a shopper goes in a store and what she buys.
The beacons encrypt all data and run on batteries that last for roughly five years, she says.
Retailers can set up in stores as many of the beacons as they like, at a cost of $40 each. They can also ask Shopkick by phone or e-mail to adjust the radius in which each beacon communicates with mobile apps, Rask says. That way, a department store like Macy’s can narrow the radius to only cover the perfume department and send a shopper a notification about a new perfume it is featuring as she walks through the department, for example. Or, the beacon could be tuned more widely to remind a shopper as she enters the store to visit the shoe department for a pair of boots she previously liked in the Shopkick app. Retailers receive in a dashboard reports about the foot traffic, sales and other metrics that the Shopkick app claims to influence.
ShopBeacon can detect both a retailer’s own app and the Shopkick rewards app, and the retailer may send special offers via either one, Rask says. The beacons work with the iPhone 4S or higher models and Android devices operating on version 4.3 or higher. That encompasses roughly half of the 6.5 million consumers who use the Shopkick app now, Rask says, and will eventually cover most smartphones as older-generation devices phase out.