Comment: Did Pokemon Go just make location marketing desirable?

Juha Mattsson

Retail history was probably made last week as Pokemon Go was launched with unprecedented rates of adoption. Why so? 

Let’s rewind a bit. Using shoppers’ location, and especially indoor location, to trigger offers and engagements to their handhelds has been on the radar of retailers for more than a decade. And from the day Apple made iBeaconsdesirapple” among especially the marketing industry a few years ago, we’ve seen many actual pilot projects initiated by retailers, too.

It all makes sense. What would be a better context to trigger marketing experiences than the actual store, when customers have just entered and begun their shopping journey? To give contrast, consider receiving grocery offers to your e-mail every Monday morning, for example.

Even the business impacts of triggering location based in-store offers have been documented and proven substantial.

The Tesla effect of pushing markets to disruption

With all that obviousness and technological readiness, widespread implementations of in-store location marketing have still remained scant to date.

The reason is simple.  Everyone has been waiting for the big disruptive move that would make it desirable to receive context specific (i.e. location based) marketing messages to your handheld. Technology is an enabler but rarely the factor that pushes markets into paradigm shift. Or people to adopt new behaviour on a mass scale.

The setting is similar to electric cars. Virtually all premium car manufacturers, including BMW and Volvo, have had electric car technology at their disposal for decades. Only now that Tesla made driving fully electric cars desirable, other brands are following suit and announcing electric models as quickly as they can. 

Pokemon Go is now about to be the Tesla of location marketing for brick-and-mortar.

But the real deal is: will the Pokemon phenomenon sustain its power in terms of bringing additional footfall and sales to high street stores, or will it tame down to remain a LARP alike hobby of a narrow niche?

The psychology of why in-store engagement works

Looking at the behavioural mechanisms behind the phenomenon, there’s reason to believe that, if not Pokemon, at least some form of location based in-store marketing will remain effective and widely in use in the future. 

Explaining the success of Pokemon Go and other forms of in-store engagement isn’t rocket science. But it’s close -- it’s psychology. Here’s a compilation of the most common explanations to the phenomenon:

Achievements, trophies and rewards

One way to look at this is through research findings showing how achievements, trophies and rewards have a strong motivational impact on our behaviour. Proven for computer games like Pokemon Go but also widely elsewhere, it is no surprise achieving points, collecting reward stamps, getting bonus or ‘earning’ via discounts gives us a positive psychological resonance.

Relevancy and context

In a recent case study we studied how merely changing the context (i.e. place, time and channel) of receiving retail offers had a substantial lift on basket size and purchase frequency. Context means a lot, and it’s no news marketing actions are more effective if they are received in the right place, at the right time, and through the right channel.

Anchoring and rationalising the buying decision

It has also been widely demonstrated that discounts are vital for boosting the frequency and amount of purchases. Discounts generally discourage cart abandonment and encourage new trial. The underlying explanation is anchoring and rationalising: with a discounted price, shoppers get both (i) a general anchor to the value of the product, and (ii) a justification to buy now instead of later.

Exclusivity and brand engagement

Yet another way to look at this is through psychological sensations like belonging, exclusivity, celebration and even surprise. The effectiveness of in store promotions have been explained through these factors, highlighting the importance of regular, personalised engagement with the brand.

Will the in-store shopping experience get further gamified?

Besides the above factors, there’s a plethora of mechanisms that impact human behaviour, such as Quantic Foundry’s research based six gamer motivators: action, social experiences, mastery, immersion, creativity, and achievement experiences.

My gut feeling is that this will not be the final writing about psychological tactics moving from elsewhere to brick-and-mortar retail.

WALKBASE BRIEFLY

Walkbase provides a retail analytics solution for improving the impact of marketing on physical stores and personalising in-store shopping experience.

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