Shopkick totally recreates its shopping app. Gamification out, design and content in

By Sarah Lacy , written on October 17, 2012

From The News Desk

Shopkick is launching a massive redesign today. It was the result of nine months of daily product meetings. Focus groups with moms at malls were involved. The product was literally reinvented on a white sheet of a paper. The company doubled the size of the team to pull it off.

Founder and CEO Cyriac Roeding said it was one of the most intense nine months of his life. It was almost like being pregnant -- which, coincidentally, his wife was doing at pretty much the exact same time.

It'd be easy to see this relaunch as Shopkick following the herd. Gone are the gamification aspects to the site that were so hot in the market a few years ago. Now it's all about design and big images and commerce as content. "We have these things called lookbooks," Roeding says, showing me the site Monday. Yes, you and ShoeDazzle and JustFab and nearly every other commerce company that's launched in the last few years.

A few years ago Shopkick was always compared to Foursquare and other then-hot location based services. Now, it's clearly embraced the Fab/Pinterest design and magazine-like world of shopping.

But while the skin may look trendy, underneath Shopkick is still doing something very unique by building a digital layer on top of real world shopping that helps retailers get you in the store, buy stuff, and exceed their average basket sizes.

While much of the rest of the mobile commerce world is all about digital, Roeding has always been enamored by the gaudy numbers for real world commerce that far exceed digital. Retail is the third largest industry in the country after energy and healthcare, offline is 12 times larger than online, and the segment of real world commerce that's driven by lead generation via the Internet is growing faster than any other sector of retail, he says.

While the old Shopkick aimed to get you to walk into the store -- with in-store technology that made the "check in" more precise, the new version wants to exploit what Roeding talks about as an arc from the couch to the store. It wants to be the digital catalog you flip through at home, pulling what you like into a "fav box" and then showing you retail clusters in the real world where you can find those items and unlock the most "Kicks" -- Shopkick's loyalty currency.

He says the concept was born out of watching how people were using the app. The average user was active on Shopkick for nine days out of 30, and six of those were out of the store, even though the app was totally designed to get people into stores.

The insight makes sense. Companies spend loads of money on circulars and catalogs to get you into stores, and Shopkick has essentially digitized that in a well-designed, elegant way. Roeding claims this couch-to store loop, if it works, is nothing less than the real-world equivalent of how Google delivers you to a Web page with intent to buy a certain item. "It's intent generation and intent direction," he says.

The product is well-throught through, the thesis is sound, and Roeding is always a compelling pitch man. But as I was listening to the pitch, two things just didn't square with me.

The first is why Shopkick would utterly trash and rebuild its app if the company was doing as well as Roeding claims. He noted that the company has doubled its footprint in three months with massive chains like Target, American Eagle, and Macy's all going from pilot programs to nationwide rollouts in the past year. Shopkick now has a network of 7,000 stores and 50 brands all giving out varying "Kicks" to users. On the user side he cites a recent Nielsen study of all shopping apps that showed Shopkick as the top one in terms of engagement and number four in terms of active reach. Most tellingly, the other three were well-known ecommerce giants.

I asked repeatedly what was not to his liking to inspire such drastic moves, and Roeding kept insisting everything was going great. "If things are going great that's the exact time you should change everything," he said instead.


I mean, I get that startups should always been iterating -- particularly on a platform like mobile where the underlying hardware is continually changing. But this isn't iteration. This is, in Roeding's own words, throwing out the entire product and starting again from scratch.

I asked him for one example of another company that has destroyed a product, because it was going great. He cites Apple. I counter back that Apple didn't "destroy" the Mac when it created the iPod, it added a new product. And Steve Jobs famously didn't follow focus groups and market research, so the comparison seems off. He grants the point and can't come up with another example.

After our meeting I came up with one, and it's not flattering: ShoeDazzle. Bill Strauss came in as CEO and -- based on surveys -- threw out the company's subscription-in-a-box service, which worked so well that it spawned an industry of copycats. Less than a year later, Strauss was out, and the company is reeling from the bad decision.

I don't mean to suggest Shopkick is going the way of ShoeDazzle. The ShoeDazzle move never made sense to me -- as its move threw out the core of what the company was. Shopkick isn't doing that. It's keeping the motor but just changing the body, the paint job, and everything else around it.

It's just hard to buy that such dramatic steps were taken for nine months of a company's life -- eternity in startup terms -- if everything was going awesome.

The other thing that nagged at me: I just wouldn't use the service, personally. I kept telling myself I'm not the demographic, but actually I'm square in the middle of the demographic in terms of age range, gender, and being a mother to young children. And yet, to me, the idea of downloading an app, flipping through pictures to unlock extra points, and loading up the strollers to walk around malls and unlock more points, all to get a $10 Target gift card, sounds like the last way I'd spend my free time, should I come across any.

But in focus group after focus group, Roeding tells me most moms are not like me. They love that it rewards them for something they do anyway, and even get excited when they hear the little noise the app makes when they walk into a store. They even reported meeting other moms using Shopkick and evangelizing it to their mommy groups. "How many mommy groups are you a member of?" Roeding asks to make his point that I'm not exactly central casting in this role. Touche. 

But what's puzzling is how different this was from my initial thought on Shopkick days after it launched the first time. Back then -- as Roeding reminds me -- I said I was far more likely to use Shopkick than other location-based, check in services, because it gave me something for that relative invasion of privacy. Maybe I've gotten busier since then. Or maybe in practice, the rewards just aren't exciting enough. Or maybe the number of apps has just creeped up too much on my phone between then and now, and the idea of clicking and swiping anything else to get something just sounds too taxing.

Roeding asked me what would make me use it, and I describe something that cuts out hassle rather than creates more work. Something that could tell me where in the store that item I liked in the lookbook was and what store had it in my size. Something that did the shopping equivalent to how airline points allow you to skip the regular check-in line. Features like that are possible based on the individual store data, Roeding says. Of course, the risk is adding in too much complexity to what's a painstakingly stripped down product.

I may never use Shopkick and the company will do just fine. Right now it has 4 million users, and if it gets to 10 million it's "in a great spot." If it gets 20 million to 30 million users, "we're huge," Roeding says.

This is what I love about where mobile is taking the consumer Web, as we talked about with Dennis Crowley last week at PandoMonthly. Mobile isn't about getting to 1 billion users or even 100 million users. It's about creating so much value with each inherent user relationship that millions or tens of millions of users are worth more than they are on the Web.

There are at least 20 million avid bargain hunters with time to walk into stores in this country -- on that Roeding and I can agree.