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Shopkick Adds In-App Purchases To Help Retailers Fight Amazon: ‘We Are The Anti-Amazon Coalition'
Shopkick, the iOS and Android app that lets users search for products, find out where they are sold, and then automatically get checked in at retail locations for discounts to buy them in stores, is making another move today that widens its remit beyond simply driving more bricks-and-mortar business. The startup is launching in-app purchases, starting with 30 major stores that were already a part of the Shopkick’s product aggregation platform, including Target, Macy’s, Best Buy, Old Navy and Anthropologie.
You might think this sounds like a step away from Shopkick’s original physical store business, which the company tells became profitable at the end of last year. Co-founder and CEO Cyriac Roeding paints it another way: it’s an expansion of Shopkick’s revenue streams, yes, but it also will help stores compete better against their biggest threat today: Amazon.
“We’re not including Amazon in our app,” he says flatly. “Using our app to buy goods means you will be buying goods from the actual stores, not Amazon. We are the anti-Amazon coalition.”
Shopkick has for a while been pushing the concept of the so-called “omni-channel” shopper — the idea here is that a person who buys goods on mobile devices or via PCs are more likely to be more valuable physical-store shoppers, too.
Roeding maintains that this is not just a case of shopaholics-gotta-shop but that going online actually lifts offline activity even for normal people. This data from Forrester appears to support that idea, with growth in digital-influenced physical shopping revenues currently growing faster than e-commerce sales, respectively at 19% and 12%:
Indeed, Roeding tells me that right now, revenues from physical stores are 100% of Shopkick’s sales, and even with new services like in-app purchasing, he doesn’t expect that to come down to any less than 90% in the future.
Shopkick, for background, works like this: the company offers a mobile app, which lets users search for products by name or by store. If by name, you are then provided with lists of who is stocking the product in question (this is where the aggregation comes in). You can also see how popular a product is, and you can tag it. When you visit a participating retailer, you get a ping on your device if you have the app open. That ping is very accurate, because it relies on actual hardware that Shopkick’s installed in the stores itself.
In the past, when you bought things, or even walked into stores, you got “kicks” on the app — effectively loyalty points for future discounts. Now you can get kicks as well as follow through and buy the product through the app. Roeding says Shopkick gets its own “kick” (ie payment) when a consumer “likes” a product, and then again when the consumer subsequently buys it, in the form of an affiliate fee if the purchase is made with a linked credit card (which is also how the consumer loyalty points get redeemed). The percentages vary because some deals are direct with brands, while others are with stores, and they range from fashion apparel through to printer cartridges.
The unique selling point for retailers is that, while some power shoppers might download those stores’ apps, Shopkick offers a “shopping mall” style experience where several stores can get their products and brands in front of shoppers who may not be regular enough to use their own bespoke apps.
Growth ahead
Shopkick, which at the end of 2012 said it made $200 million in revenue and was profitable, is not yet revealing active user numbers on its platform, but Roeding says that there are now more than 1 billion product views through the app every quarter. That means Shopkick is finally reaching a critical mass where it might start to consider what its next steps might be.
That will likely lead it to finally go international — in some ways long overdue for an app that’s been around since 2009.
Roeding, an ex-pat who hails from Germany, says this has been intentional. “Once we have that consumer experience nailed, we are going international. It’s certainly getting interesting for us [read: good returns because of scale], and there a lot of interest for shopkick to go abroad.”
He wouldn’t comment on whether that might mean Shopkick will look to raise more money — it’s raised $20 million from top VCs like Kleiner Perkins, SV Angel, Reid Hoffman, and Citi, but the last round was in 2010 — but that seems like a good bet.
What’s perhaps interesting, too, is how the company will evolve not just in terms of geography, but also product-wise going forward. For all the me-too e-commerce services out in the market today across different geographies, Roeding points out a kind of unique lock-in with the Shopkick platform. “You can’t just clone Shopkick because you need, on top of consumer users, technology on the retail backend, along with partnerships to implement the backend. You need time to do this.”
When Shopkick raised its first round of money, Roeding said that it hadn’t actually created its radio-based hardware yet. “We got funded by Kleiner without a solution in place for measuring the threshold of users walking into stores,” he says of the hardware that emits high frequencies unique to each store and recognised by the app to chart users. “GPS could not do what we wanted it to do, so we built it. And we are working on improving it more, adding presence versus vicinity. We are constantly building out that technology.”
Having said that, Roeding adds that “Shopkick was never built around technology per se,” and that they are not wedded to the hardware or anything else for that matter.
In fact, when (not if) Shopkick moves into point-of-sale purchases — a very logical next step for “closig the loop” on commerce for the company — it will be in partnership with other technology providers. In a market that appears more focused today on land grabs rather than more innovations, there doesn’t really seem to be any point in the company reinventing that wheel.
Amazon-Acquired Goodreads Says It Has 20M Members, Doubling In Less Than A Year
Goodreads, the social reading service that Amazon acquired earlier this year, is announcing today that it has reached 20 million members.
CEO and co-founder Otis Chandler said that since it launched in 2007, the site has seen “slow-but-steady growth,” but things really started to accelerate in the past year. It took Goodreads only 11 months to double its membership after hitting 10 million members in August 2012.
Chandler identified three main factors behind the accelerating growth. First, he said, Goodreads has now built up “a critical mass of book reviews.” He said he isn’t sure about exactly where the threshold was, but with more than 25 million reviews, Goodreads now covers enough titles that you can find lots of useful content.
Second, he said Goodreads has seen “explosive” mobile growth. He noted that with all that review content, users are going to want to look up titles before they purchase them in bookstores, and the easiest way to do that is from their phones. Plus, he said it reflects “where people are when they’re reading books” (if they’re out at the beach and they finish a book, the easiest way to post review or a rating is, again, likely to be from their phone) and the fact that “more people are reading on mobile devices than ever before.”
The third factor has been Goodreads’ international growth. He didn’t offer any specific numbers, but he said he’s been surprised to see that growth since the site hasn’t really made a concerted effort to promote itself globally, and in fact doesn’t offer any localized versions outside the United States — that’s something that’s going to change, he said.
And yes, Chandler said he expects that being owned by Amazon will also contribute to growth, since Amazon can provide plenty of resources behind, say, an international push, plus it has an enormous audience of its own. There’s been a lot of growth in terms of head count — Goodreads had 35 employees at the time of the acquisition and it now has 58. Chandler said the team just moved into a new San Francisco office, claiming one of Amazon Music’s empty floors.
At the same time, he said Goodreads has maintained the independence that he had promised when the acquisition was announced. The site has continued to operate “in the vein of IMDB and Audible and Zappos as an independent brand” that’s owned by Amazon, and for folks who were worried that Goodreads would become a Kindle-only social network, Chandler said “Amazon management has continued to be very supportive of us working on all readers indefinitely.”
Cisco Acquires Cybersecurity Company Sourcefire For $2.7B
Cisco has just announced the acquisition of Sourcefire, a company that creates cybersecurity products to protect companies from attacks. The purchase price is $2.7 billion, or $76 per share in cash plus retention-based incentives.
Founded in 2001, Maryland-based Sourcefire offers a number of security products that ensure threat detection and network protection from threats including prevention systems, firewalls, and advanced malware protection. Large- to mid-size organizations and government agencies use Sourcefire to protect their dynamic networks, endpoints, mobile devices and virtual environments.
As Cisco explains, this acquisition “adds a team with deep security DNA to Cisco and will accelerate delivery of Cisco’s security strategy of defending, discovering, and remediating advanced threats.” At the end of 2012, Sourcefire, which went public in 2007, reported revenue of $223.1 million, an increase of 35 percent year-over-year.
Upon completion of the transaction Sourcefire employees will join the Cisco Security Group.
Cisco has been aggressively building its portfolio of security technologies. Earlier this year, the company acquired Czech network security startup, Cognitive Security. Last year Cisco acquired data center security company Virtuata. Cybersecurity is certainly an area that more and more large companies are paying attention to, and clearly Cisco wants to be the go-to destination for protection from any threats.
This NFC Ring Puts Wireless Transfer Tech On Your Finger So You Can Fist-Bump Phones
The tech world may be hoping for Apple to unbox some wearable technology in the near future but who cares about the iWatch when an NFC ring is a thing? NFC fans — you know, these sort of folk — hankering for the convenience of having the wireless transfer tech always on their person should point their eyes at this U.K.-based Kickstarter project.
The NFC ring is designed to be used in conjunction with NFC-enabled gadgets — such as smartphones and tablets, NFC door locks and so on — so the wearer can perform tasks such as unlocking their phone, unlocking their front door or sending their contact info, personal website or Bitcoin address to another smartphone user by either fist-bumping or using an open-palm gesture.
Provided you’re happy to wear a bit of bling, the relatively slimline ring gets around some of the awkwardness associated with bumping and grinding NFC phones together to do data transfers (aka ‘phone sex‘). Being passive NFC, it also doesn’t need any battery power to work. And all the programming is done via apps, including third party apps if you want to use it to unlock your phone. The NFC ring creators have also made their own open source software for writing actions to the ring.
The ring actually has two NFC inlays, with a larger ‘public’ area designed to worn at the top for sending things like contact data via a fist bump gesture, and a smaller ‘private’ area designed to be worn so it can be concealed in the palm and only activated via an open palm gesture. This area is intended to store more sensitive data such as front door and phone unlocking info, says creator John McLear.
The dual NFC design is intended to help keep a ring owner’s most sensitive data from being slurped by nearby NFC readers. But it’s worth pointing out that jewellery rarely stays put so NFC ring bearers are likely to end up spending a lot of time checking their precious is correctly aligned. Or drunkenly failing to send contact info to the person they are trying to chat up in the bar, and trying to unlock a non-existent front door instead. That’s a whole new level of geek faux pas.
The NFC ring is basically a more convenient (i.e. wearable) version of the NFC tags that are sometimes shipped with NFC smartphones. But since awkwardness is a barrier to more widespread NFC use, anything that helps reduces friction is a welcome development for the contactless fraternity.
The NFC ring is fast approaching its Kickstarter funding goal of £30,000 — with close to 1,100 backers pledging almost £29,500 so far with 27 days left on the campaign. The creators say rings are due to ship in late October, if all goes to plan. Cost per ring is around £25/$38 but the creators have also released a CAD design so the basic ring form can be hacked, customised and 3D printed. They are then offering cheaper pledges to just ship the NFC inlay for fixing inside these 3D printed rings.
It’s worth flagging that the “normal size ring” (which is ~7mm wide) doesn’t work with all NFC phones — notably the Samsung Galaxy S4 and BlackBerry Z10 won’t play nice. For those devices the creators warn “you will need an alpha size ring”, which they add is “really only for chaps with big fingers”.
Healthy Snack Subscription Commerce Startup NatureBox Raises $8.5 Million From General Catalyst & Softbank
Subscription commerce startup NatureBox launched 18 months ago to create a line of tasty, healthy snacks shipped to customers once a month. Today the company is announcing that it’s raised an $8.5 million Series A round of funding led by General Catalyst and Softbank Capital. The funding will go toward expanding its engineering team, with an eye toward building new products to increase customer satisfaction.
NatureBox is kind of like Birchbox for healthy snacks. For $20 a month, subscribers get a box full of food that can be an alternative to the usual crappy snack food that they eat on the go. All NatureBox snacks are nutritionist approved, and lack the high-fructose corn syrup, hydrogenated oils, trans fats, and artificial sweeteners, flavors, and colors that are included in typical snacks. The startup also tries to partner with local growers and independent food suppliers to source the materials.
NatureBox currently has about 80 different healthy snack options available to send to customers, and adds about 5-10 new products per month, while occasionally removing others. It expects to have more than 100 options by year-end. But it’s not just about creating a wide range of healthy snacks. NatureBox also has to get folks eating them. And so, the startup matches customers with snacks that they’ll love, and — more importantly, that fit their dietary restrictions.
So far, the idea seems to be catching on. In 2012, the company shipped 50,000 boxes to subscribers. This year, it expects to increase that to more than a million annual shipments.
But there’s still work that could be done. That includes improving its data analytics and the algorithm matching products to customers, for instance. That’s part of NatureBox’s plans to grow its engineering team to better serve its customers, according to NatureBox CEO Gautam Gupta. It also plans to invest in product and marketing functions with the new funding.
Last December, NatureBox had raised $2 million from General Catalyst, Redpoint Ventures, and a bunch of angels. The company is based in San Carlos, Calif. and currently has 35 employees, but is targeting 45 by the end of the year, according to Gupta.
Apple Patents On-Hold Media Sharing, Dual Sensor Imaging For iPhone, iPad And Mac
Apple has won a couple of patents today from the USPTO (via AppleInsider), and both are very practical advancements of tech that it’s easy to imagine being integrated in upcoming versions of existing devices. One is a camera sensor imaging enhancement that could make its way into both mobile and Mac product lines, and the other is a way to make hold more enjoyable for the person doing the waiting on a call.
The imaging patent describes a dual sensor camera system that could be integrated into iOS devices like the iPad and iPhone, as well as into Mac computers, that would use two sensors instead of one to capture simultaneous imaging data and then stitch those together intelligently, picking the best of each and obscuring the other sensor’s faults.
This would have the effect of covering up bad or dead pixels on one sensor, identifying blurry parts or strange exposure or lighting effects and compensating with image data captured by the other sensor. The patent describes a way for it to work with both still images and video, which is probably why it’s described as being useful both for mobile devices and for Macs, where it could help improve video quality being fed to chat applications from the built-in FaceTime camera.
The hold call patent is perhaps of more limited utility, but it does provide a way for users to share their photos and music with one another in an unconventional way. When people are on hold, they’d be presented with a variety of available data from the other party that they could browse while waiting. Options include pictures, music, upcoming events, location, books, wait time, status updates, videos or a recorded message, and a user can customize what kind of content gets shared, and where it gets sourced.
Access to hold content can be adjusted on a granular level, too, allowing you to opt to share some types of content only with family members for instance, while all callers have a much more constrained set of data to check out. Since it could potentially be something the hold party might actually enjoy, there’s even a provision that would let the person who put you on hold indicate they’re ready to come back on the line, giving you a chance to wrap up.
It’s a little precious, as use cases for this might be limited (who even talks on the phone anymore, let alone puts anyone on hold?) but it’s also potentially an easy way for Apple to indirectly advertise more of its iTunes content, and it’s a feature that would show well in demos and in marketing material. Also, it seems like it would be relatively easy to implement.
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