• by Mark Walsh  @markfwal, June 1, 2012

Since launching almost two years ago, the shopkick app has gained more than 3 million active users who use it to earn points for rewards and discounts at national retailers, including Target, Best Buy, American Eagle Outfitters, Macy’s and Toys “R” Us. Shopkick (the company) also works directly with CPG and other brands, including Kraft Foods, Procter & Gamble, Intel and HP.

Online Media Daily recently caught up with shopkick co-founder and Chief Product Officer Jeff Sellinger about the brand side of the business, which he oversees. Before starting shopkick with cofounder Cyriac Roeding in 2009, Sellinger was general manager of CBS Mobile.

OMD: Much of the attention around shopkick so far has been about its expansion across big-box retailers. What’s happening on the brand side?

Sellinger: The brand side of our business is expanding quickly. We’ve worked with over 50 brands. Essentially, we’re driving users through the path to purchase, but doing it in a way that is really fun. We teach the user about products with game mechanics that drive massive recall and then get them to engage with the products in-store and at shelf. Most people probably can’t remember the last mobile banner ad they saw, but our users can recall the last product they saw in shopkick.  

We recently did a campaign with a Kraft brand -- Ritz -- and not only did the users go through the path to purchase, but up to 25% reported they bought the product. Users learned about the product through gaming mechanics, saw impressions at the store, and then got points to go find the product and scan it. 

OMD:  How do the basic business models differ in working with retailers compared to brands?

Sellinger: They’re very similar. We are really performance-based marketing in the physical world. Retailers pay when users walk into stores and brands only pay when users engage with their products. So it’s on cost-per-engagement basis. When brands offer up rewards within shopkick, we’re just driving more traffic to the store and deeper engagements. 

OMD:  Besides driving transactions, companies want reporting on campaigns and interaction. What user data do you provide to brands?

Sellinger: We share data, including where scans take place, how many people interacted, top stores, top markets, daily rates, SKU versus SKU, shopper marketing survey data, recall and purchase intent results, etc. 

OMD:  Apps aren’t known for having a long shelf life. Do shopkick users tend to use the app for a month or two, then trail off? 

Sellinger: We see retention rates four to eight times higher than comparable apps. There is long-term value because users can collect points and redeem them for great rewards. There’s short-term value because of the fun nature of the app and the gaming elements. Because there are so many brands and retailers in the app, there’s always something to do when you’re out.

OMD: What’s the issue with mobile coupons and how does that affect shopkick?

Sellinger: The act of pulling out your phone at the register is a newer behavior, and in the heat of paying for something with a line behind you, some users may be a bit timid. As app developers, it’s our job to make this a great experience. It can be challenging today because there isn’t one ubiquitous way of redeeming coupons, too. The more we can create common experiences, the faster this will grow. Shopkick’s rewards allow users to redeem rewards in the app versus the embarrassment someone might feel when redeeming coupons.