Circle K Signals SMB Immersive Ad Potential

In the quest to keep a finger on the pulse of emerging tech that impacts local commerce, we’re keeping one eye on augmented reality. This includes visual search like Google Lens, which can help consumers contextualize physical world places and things (think: storefronts) with informational overlays.

Another way AR plays out as a local marketing channel is in location-based gaming. Yes, we’re talking about Pokémon Go. Though the tech press has moved on to other shiny objects, the game is still going strong, including engagement levels and $5 billion in lifetime revenue (in-app purchases).

What does that have to do with local commerce? In an effort to grow and diversify its revenue, Pokémon Go maker Niantic has launched a local ad program. Brands and SMBs can buy placement within the game to designate their locations as in-game waypoints (e.g. Pokéstops), and generate foot traffic.

Pokémon Go, Now with More SMB Marketing

Action Oriented

As we’ve examined, Niantic’s Sponsorship Platform is used by retailers like Starbucks, McDonald’s and 7-eleven. It’s particularly fitting for QSR and coffee shops to “fuel” players. But the latest activity comes from convenience chain Circle K, including the use of redeemable rewards for the first time.

In other words, Niantic’s ad program is getting more action-oriented. The appeal for advertisers to date has been attracting hordes of hungry Pokémon Go players to their doorsteps. The latest brings rewards into the mix, which not only attracts players but provides an additional attribution mechanism.

As background on the dynamics of the sponsorship program, businesses pay to designate themselves as in-game waypoints. This includes “raids” which attract send players to a specific spot where Pokémon hatch. Sponsors can designate raids at specific places and times (think: slow hours).

The key word in all of this is organic, as sponsorship is aligned with gameplay. Niantic reports that 73 percent of players deviate from regular walking routes – sometimes to sponsored locations – to achieve in-game milestones. 84 percent interact with commercial locations and 58 percent transact.

Long Tail

One thing to note is that Circle K and other examples above are multi-location brands. In local marketing, they tend to be early adopters given sophisticated marketing resources. But Niantic’s real target – explicit in the program’s launch – is SMBs. Self-serve ads and low-cost are baked in attributes.

Furthermore, foot-traffic surges resonate with SMBs. And this generally happens in a tangible way with immediate gratification, given the timed raids noted above. Now, adding rewards and deals to the mix could elevate the program in terms of tangible and measurable consumer action.

As noted, QSR and coffee are natural products in that they integrate with Pokemon Go’s migratory play. Convenience stores are fitting for the same reason and for demographic alignment with younger players. For example, Circle K promotions include coffee, candy, hot dogs and K-Freeze drinks.

These promotions will change over time to keep things fresh (maybe not the best adjective for CPG-heavy fare). Product rewards will be altered each month for seasonal or weather-related factors over the duration of Circle K’s 12-month activation. This could serve as a model for SMB adoption to come.

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