Government // Mobile & Wireless
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8/4/2010
12:37 PM
Fritz Nelson
Fritz Nelson
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Full Nelson: Shopkick And Novitaz Aim To Drive Rich Retail Experience

Retailers looking to lure customers into their stores and up to their cash registers have been waiting for the perfect system to pull in people with special offers. Shopkick and Novitaz are helping pave the way.

Stop me if you've heard this before: You're strolling down cobble-stoned Main Street, ice cream cone in hand, birds chirping, neighbors nodding their hello, when onto your mobile phone comes an offer for that swell ascot you've been eyeing, and it just so happens to be in the store you're in. For years, this has been the future for retail marketing: mobile, location-based, and personalized. Two companies -- Shopkick and Novitaz -- are working hard to make it the present.

Novitaz and Shopkick both start with the premise that success begins when a customer walks through the door (the real one, not the virtual one). Novitaz founder and COO Jayant Ramchandani says that 80% to 90% of customer decisions are made in the store, and yet merchants spend only a pittance on in-store marketing.

Shopkick says retailers fail to know anything about individual customers walking into the store -- a big contrast with the world of online retail. In fact, shopkick co-founder and CEO Cyriac Roeding says his company's solution is the offline equivalent of online retail: its offers represent measurable clicks and lead to measurable actions.

Novitaz and Shopkick also both face enormous challenges, because these solutions require the cooperation of an entire ecosystem of players -- merchants, consumers, payment systems, credit card issuers. A few big partnerships will be key.

I asked each company's founder to give us an overview in a minute or less. You can watch these directly below.

Novitaz creates a complete platform for managing an entire in-store campaign experience. It starts at the device level. An active-RFID chip is embedded into a credit card or loyalty card, providing consumer location. But it also requires a mobile phone to communicate with the consumer, to proliferate a campaign based on a variety of contextual characteristics like geography and brand affinity. The company doesn't yet have a credit card agreement, but it actually thinks its success is in an affinity card model. Ramchandani mentioned Yelp as an ideal partner, where Novitaz gets much broader distribution than signing merchants one at a time.

The Novitaz platform also includes session metrics, measuring campaign response, building knowledge about consumer affinity. It ontains a rules engine that gets at whether someone has just been browsing or transacting. And it builds all of that information into customer insight -- Ramchandani calls it the knowledge layer -- so that offers can be tailored to individual customers.

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