Foursquare, Gowalla and shopkick brought the “check-in” concept to life, and the growing interest around location-based applications is prompting retailers to reevaluate marketing strategy, integrating these new technologies. Retail TouchPoints recently had the opportunity to speak with Simon Salt, author of the new book, Social Location Marketing, to uncover how retailers can drive sales with gaming, what retailers are doing to integrate location-based applications into loyalty programs, and the future implications of shopkick for the retail environment.
Retail TouchPoints (RTP): What are some of the misconceptions about how location-based marketing can drive retail revenue?
Simon Salt: Like many aspects of social media, some people believe that social location marketing is a “quick fix” to more endemic problems. Social location marketing can’t fix a bad customer experience.
It can help create a good one. It takes time and creativity. Another popular misconception is that the marketing starts and ends at the check-in, it doesn’t. The check-in is only the beginning of the engagement. There has to be more to it for the customer to want to share and repeat the experience.
RTP: In Chapter 3, “The Games People Play,” you emphasized the importance of the game theory’s influence on social location marketing. Can you expand on the potential for retailers to drive sales via gaming?
Salt: Games are a very social aspect of human nature. The social consumer is by definition focused on being social. By introducing game play into their marketing, retailers can deepen the engagement with the consumer and increase the likelihood that the experience will be shared with the consumer’s network. By building rewards into the game for such social sharing behavior increases the motivation for the consumer to pass on the experience that they have had with the brand — providing of course that it has been a good one.
RTP: In Chapter 5, “Industries Making It Work,” you talk about the advent of online retailing and its impact on traditional reward programs. Can you expand on your theory that social location marketing can help retailers create compelling, relevant campaigns?
Salt: Social location marketing has one major difference from all other types of social media — location. You know exactly where your customers and potential customers are, either they are checking in at your location or they are checking in at your competitors, either way you know that they are in a location where the probability of purchase has increased. By ensuring that messaging is relevant to a customer they are more likely to pay attention to it than, for example, receiving a random coupon in the mail that is untimely and of no particular interest.
RTP: Throughout the book you provide many real-world scenarios where location based marketing has played out successfully, including Tasti D-Lite’s social media integration with its customer loyalty program, which ultimately saw 27% of loyalty card members opting to connect via social. What are some of the basic components of a successfully executed location-based strategy with regard to social media?
Salt: The basic elements revolve around meeting the needs of the social consumer. In the book I compare these to Maslow’s Hierarchy of Needs. By meeting a need for the social consumer the retailer can position themselves as “necessary” to the social consumer. For example, in the case of Tasti Di-Lite their integration sped up the process of checking in, they gave time back to the customer — that is a need being met. Now given the choice over their process or one that requires a customer to take out their smartphone, select an app, find the location in a list within the app and then check-in, the social consumer will choose the easier option, especially when all other elements are equal, for example, rewards.
RTP: How will applications like shopkick play out in the coming years? Will more retailers adopt these types of technologies to deliver a more relevant in-store experience?
Salt: The more marketers and application developers move toward seamless integrations like shopkick, the greater the adoption rate amongst consumers. One of the biggest barriers to mass adoption at the moment is the need for active check-ins. When the consumer isn’t required to do anything other than carry their smartphone with an app running on it into the store to receive discounts, coupons or other relevant messaging we will see mass adoption. Until then marketers must realize that they have to provide the consumer with a compelling reason to check-in beyond the basic game mechanics provided by the app, for example, becoming a Foursquare mayor.
Simon Salt is the CEO and founder of International IncSlingers. He has been recognized for his ability to provide strategic marketing guidance that covers both Traditional Marketing communications & Social Media. He is the author of popular blog "the IncSlinger.” He has previously worked in the UK for an e-business consultancy, Company Net, where he started as web-developer & Project manager and rose to become the Head of Business Development.