Retail giant Macy’s Inc. is partnering with shopkick Inc. to enhance its overall mobile strategy, with the goal of inspiring consumer loyalty and driving foot traffic in-store.

Macy’s has been working with shopkick for about a year, integrating with the application to let shoppers earn rewards by visiting its bricks-and-mortar locations. The retailer is rolling out the shopkick program in approximately 150 stores in four markets—New York City, San Francisco, Los Angeles and Chicago.

“The company presented a great opportunity to pilot a location-based effort that would allow us to communicate with our customer via the one thing she always has on her—her mobile phone,” said Holly Thomas, vice president of national media relations and cause marketing at Macy’s, New York.

“Once a customer downloads the shopkick app to her iPhone, we are able to give her special offers, information and rewards just for walking in a Macy’s store,” she said. “We think this is a dynamic and exciting addition to our mobile and digital efforts.”

Shopkick, a startup funded by Kleiner Perkins’s iFund, Greylock Partners and LinkedIn founder Reid Hoffman, is bringing the mobile Internet to the retail experience via its new iPhone application.

In addition to Macy’s, shopkick’s launch partners include American Eagle Outfitters Inc., Simon Property Group Inc., The Sports Authority and Best Buy (see story).

Shopkick till you drop
The new location-based shopkick shopping application for Apple’s iPhone rewards shoppers for visiting stores. It is available in the App Store.

Upon entering a Macy’s store, the shopkick application will greet consumers with the following message: “Welcome – You just collected kickbucks.”

Consumers will then receive special offers directly through the application, and if they so choose, they can even leave their Facebook picture on a virtual store Wall of Fans.

“Shopkick really presented an opportunity, allowing us to communicate directly with customers as they are shopping in our stores,” Ms. Thomas said. “In the new era of mobile marketing—and as the mobile device continues to become a central communication and information fixture for consumers—having the ability to connect with engaged customers on their device while they shop with us is very powerful.

“We will monitor the customer engagement and feedback, but we think she will respond very positively to this,” she said. “Our primary goal is to be customer-centric—to be relevant to her, and to create a rewarding and lasting connection with her, and to that end, everything we do has to pass the litmus test of improving her interaction and shopping experience.

“Shopkick will create fun and value for her in the now as she shops with us, as well as the future incentive of accumulating rewards—we think it will be very appealing to the consumer.”

Mobile rewards inspire loyalty
Rewards and offers are live now in all partner store locations in New York, San Francisco and Los Angeles, and will kick-off in Chicago and other cities in the coming weeks.

Rewards will be delivered simply for walking into participating stores with the shopkick application open.

Within the next four weeks, more than 600 individual stores and 100 of the country’s largest malls will participate and will have fully deployed shopkick’s technology, in time for the holidays.

In addition, at thousands of other stores nationwide, smaller rewards will be offered for “checking in” and for scanning products.

The application detects a “shopkick signal” coming from the shopkick device located in each participating store, and because the detection occurs on the user’s iPhone, the privacy of presence information is completely under the user’s control.

Once a shopkick signal is detected, the application delivers reward points called “kickbucks” to users as they walk through the door.

Kickbucks can be collected across all partner stores.

The shopkick application also let users:

• Collect kickbucks for trying on clothes and scanning a barcode in the American Eagle Outfitters dressing room

• Receive special offers, for example, a discount on specific products at Macy’s, or in a particular Macy’s department

• Get more kickbucks for scanning and learning about products and services at Best Buy 

• Receive special offers for trying featured products at Sports Authority, and get extra kickbucks again

• Earn kickbucks from every retailer and redeem them at any partner retailer

Kickbucks can be redeemed with one touch for Facebook Credits to play games online, song downloads, in-store gift card rewards at shopkick partner stores, magazine subscriptions, iPods, and even donations to 30 different causes and charities.

“Our goal is to make shoppers truly happy when they go out shopping and drastically improve the shopping experience in the physical world, by turning offline stores into interactive worlds,” said Cyriac Roeding cofounder/CEO of shopkick, Palo Alto, CA.

“By earning kickbucks and other rewards, we are creating happy customers which results in returning customers,” he said.

“Imagine walking into a Macy’s, Best Buy, American Eagle Outfitters or Sports Authority store, or a Simon Mall, and having special offers and rewards practically fall from the sky right into your hands.”

Mobile Behavior
Mobile Marketer’s Dan Butcher interviewed Allison Mooney, vice president of emerging trends at Mobile Behavior, New York, who attended shopkick’s launch event in Manhattan.

Here is her list of the application’s pros and cons:

Pros:

• Retailers only pay when people go to their store, check out their products and buy stuff. This performance-based model will make the app a much easier sell.

• Shopkick is taking a brand-friendly approach, providing retailers a way to add utility and fun to the in-store shopping experience while also packaging it in ways their marketing and media teams can understand.

• Big brand parterships off the bat mean the app can add value to users immediately.

• It can be a fun thing for teens to do when hanging out at the mall or shopping with mom–shopkick essentially turns a store or mall into a big game and lets them earn real prizes.

• It provides real rewards.

• Aggregate behavior data across all participating locations could provide a much richer picture of the consumer and better targeting for all their partners.

Cons:

• The app has much appeal to teens but does not seem as geared towards older demos.

• It only works on the iPhone, not the iPod touch, which will hurt them in the teen category.

• There is a long registration process, it is semi-complicated to learn and creates one more thing to open and focus on when you are in a store.

• Whether consumers find this intrusive or valuable enough to use regularly remains to be seen.

Final Take