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Shopkick turns a quarterly profit for the first time
The 2012 holiday season was very good to the mobile shopping app, shopkick says.
Managing Editor, Mobile Commerce
Shopkick, a mobile shopping app used by consumers in stores, has revealed that it reached its first profitable quarter in the fourth quarter of 2012. It declined to reveal exact revenue figures.
The company, which employs 60 people, launched an updated app, version 3.0, in October 2012, which led to a very large holiday spike in both consumer use and revenue for shopkick and its retailer and brand clients, shopkick says. It declined to reveal the number of times the app has been downloaded but says it has more than 4.5 million active users.
“We have only been in the market for a little over two years and did not plan or expect to reach our first profitable quarter so quickly,” says Cyriac Roeding, CEO and co-founder. “Of course holidays are always the sweet spot for retail, but this far exceeded even our hopes. With this milestone, shopkick is ready for 2013, when mobile payments and mobile loyalty will start to converge, which puts shopkick in a position to get even bigger this year.”
A consumer uses the shopkick app to check in at stores and scan bar codes on products to obtain more information. Both actions, walking in (location-based sensors detect when an app user enters a store) and scanning, as well as making a purchase, earn the consumer “kicks,” reward points. She can redeem kicks in the app to obtain store gift cards, free coffee and dinners, Coach handbags, song downloads, movie tickets, Facebook Credits, donations to charity, and more.
Shopkick has driven more than $300 million in revenue to its retail and brand clients, with more than $200 million in 2012, the company says. Each engagement on shopkick is valuable to brand and retail clients, and shopkick earns a small fee for every event: every walk-in to a store, every product scan and every purchase, the company says. To date, shopkick has registered more than 16 million walk-ins to stores (2 million per month in Q4 2012), 26 million product scans and millions of transactions, shopkick reports.
Shopkick’s business model is designed to be 100% performance-based, where retailers get foot traffic, their most desired benefit, and brands get product interactions via mobile scans directly at the point of purchase, shopkick says.
“The key to mobile is making an experience that can’t exist without a mobile phone, based on performance-based business models, and that’s why shopkick is performing so well,” says Reid Hoffman, co-founder and chairman of social network LinkedIn and an investor in shopkick.
Shopkick also credits fourth quarter growth in part to its addition of look-books in the app. The look-books are designed to let consumers browse through products from shopkick retail clients and reward consumers who visit a store and scan an item found in a look-book.
Since launching in 2010, shopkick has gained 15 national retailer clients, including Target Corp., Macy’s Inc., Old Navy, American Eagle Outfitters Inc., Best Buy Co. Inc., Crate & Barrel, Toys ‘R’ Us Inc., ExxonMobil and Simon Malls; and more than 70 brands, including Procter & Gamble, Kraft Foods, Disney, Revlon, Unilever and Pepsi.
Shopkick has location-based technology in more than 7,500 stores and malls, and consumers can interact with brand products at more than 250,000 locations nationwide, the company says.