Best Buy Launches Location-Based Retail Experiment

August 23, 2010 by Brian Rice

Best Buy recently launched a location-based retail experiment, using the "shopkick" mobile application rewards system. Best Buy will examine the ways in-store shoppers value and redeem offers and rewards through their smart phones.
Under the plans, the "shopkick" system launched on August 17th in 187 Best Buy stores in the San Francisco, Los Angeles, San Jose, New York City, Chicago markets, with an additional 70 stores in Dallas, Minneapolis-St. Paul and Miami markets scheduled to go-live by Oct. 1st. 
"We think consumers have more opportunities than ever to bridge their digital and physical shopping experiences, particularly through smart phones and mobile technology," said Matthew Smith, vice president, marketing services, Best Buy. "We intend to explore ways we can use the power of location-based technology to personalize a Best Buy shopping experience, from check-in to check-out, with rewards and offers delivered right on a customer's smart phone."
How the Program Works
A Best Buy customer can choose to download the free "shopkick" mobile application for their smart phone. When the "shopkick" app is open on the customer's phone, it detects the "shopkick Signal" technology installed in the participating Best Buy store as the customer walks through the door. The customer then instantly receives rewards, called "kickbucks," which can be accrued over time, then redeemed in the store or converted into Best Buy certificates through a user's shopkick account.
Additionally, Best Buy has integrated shopkick directly into its point of sale system to streamline the redemption of special in-store offers and/or added bonuses for scanning barcodes of specific products, all of which will be sent to the user's phone. Customers may walk up to the cashier, provide the mobile phone number connected to their shopkick account, and any applicable personalized discounts immediately appear on their receipt.
Unlike traditional GPS location-based services that require a shopper to "check in," and offer an accuracy radius of 100 to 1,000 yards (within a block or two), the "shopkick Signal" technology requires no consumer check in and detects that a user is truly present in the retail location. And because the detection occurs on the consumer's phone, the privacy of presence information is completely under the user's control.
Best Buy intends to run a series of promotions and offers through the stores participating in the experiment, as variables to determine how much customers value the experience.
 
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