Placecast Launches Geo-SMS 'ShopAlerts'

Placecast was recently featured in a piece in the NY Times about "geo-fencing" and retailer The North Face. The company was using Placecast's system to send SMS alerts and marketing messages to users (already opted-in) who were within a certain proximity to a North Face retail outlet.

Today the company is broadly announcing the availability of this capability, which has been in trials with a number of US retailers:

Placecast's ShopAlerts service is a retailer marketing solution. Retailers leverage the technology to create their own version of the service; then consumers choose the brands they love, and may opt-in through many ways - at the store, online, via text-message, mobile website, or social network (like Facebook). Once ShopAlerts is activated, consumers go about their day and the service automatically alerts them when they are near a location that they are interested in or when the brand is offering sales and specials.

Unlike many new mobile advertising innovations available only as applications on smartphones, ShopAlerts works on any phone, which is a benefit for retailers who wish to reach the 196 million Americans who do not own smartphones but are interested in such shopping deals . . .

Four retailers are on board at launch: SONIC, American Eagle Outfitters, and REI. Here's a video that explains and demonstrates the service: 

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This is the "Starbucks coupon" scenario that people have been talking about for years. The difference here is that people opt-in to receive these alerts so they're not mysterious spam. But they are transmitted when you're within a certain distance from a store. As a result they're relevant in at least two ways:

  • These alerts represent content (deals/offers) that people are interested in -- they opt-in so response will be much higher
  • They're locally relevant because you're within a reasonable distance (that can vary) from a store¬†

This is location-based marketing but it's not "advertising" in the sense that nobody's bought an ad placement on a network or website. This is the blind spot in most of the mobile ad forecasts out there. SMS and direct marketing services delivered to your phone are often not considered in the major mobile ad forecasts in the market. However this will be a huge area for both retailers and other local businesses as well as consumers.

Placecast conducted a survey among consumers who participated in the ShopAlerts trials and found the following:

  • 60% of participants found the location-triggered messages to be cool & innovative
  • 79% said it increased their likelihood to visit a store
  • 65% made a purchase as a result of a ShopAlerts message
  • 73% of participants would definitely or probably use the service in the future