“We were looking for a creative outlet that lets us work with our hands,” said Jojo, who is a consultant most days of the week.  “In New York, because it’s so rich with an artisan craft scene, it drives you to do something that gets you away from the computer, to create something that’s more tangible.”

Since May, they’ve sold their goods, under the name Le Petit Monster, on Etsy and Craigslist. But starting Wednesday, the part-time handcrafters are getting a full-time virtual storefront on Zaarly, as the San Francisco startup expands its new marketplace of people to New York.

“It’s the city of the side hustle,” joked Zaarly CEO and co-founder Bo Fishback. “It’s a community of people who are super engaged on more than one axis.”

Earlier this month, Zaarly launched Storefronts in San Francisco, moving its platform from what some have called a “reverse Craigslist” where people can request any item to a marketplace showcasing the goods and services talented local people can provide.

A people-first marketplace

By the end of the week, about 100 hand-picked New Yorkers will have live Zaarly storefronts to sell everything from personal training packages for couples to custom jewelry and furniture to specialty grilled cheese sandwiches and baked goods.  Over the next few months, the site will add sellers in New York and San Francisco and will expand to other cities across the country.

Fishback said about half of the featured sellers are using Zaarly to promote a growing full-time business and half are trying to give their so-called “side hustle” a more professional presence.

Since launching, Zaarly has processed about $40 million in requests through its original platform that allows people to ask for any item or service (like “I’m looking for an iPhone 4s for $50” or “I need someone to install shelves”) from people in a local area. But, as I wrote when Storefronts launched, the new people-first marketplace really sets Zaarly apart from other startups, like OfferUp, Grabio and HipSwap, that want to update eBay and Craigslist.

The new strategy, which cuts across all verticals, makes Zaarly a bit more competitive with other locally focused startups, such as SideTour, which offers unique local experiences, and TaskRabbit, which lets people outsource errands.

Fishback acknowledged that the company’s approach is ambitious but said, “what Airbnb is trying to do for spaces, we can do for people.”

Professionalizing hobbies

Especially in a place like New York that has such a high density of multi-talented people, I’m really curious to see the kinds of new services Zaarly brings to a larger audience of buyers and the kinds of opportunities it opens up for creative sellers. With technology, the nature of work is changing so much and platforms like Zaarly give people a chance to try on multiple professional hats as well as create new revenue streams.

For example, Diana Spalding, a Brooklyn midwife, told me that she and her graphic designer husband Cam always seem to be the go-to couple for planning friends’ baby showers and birthday parties. Through Zaarly, they now have a way to sell their party-planning services and see what it might be like to professionalize an activity that they love.

“My parents always said that if you have the opportunity to turn a hobby into a job, you should go for it, and this is exactly what that is,” she said. “We figured it would be a great opportunity to test the waters and see what it’s like on a professional level.”

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Flash analysis: Collaborative consumption – a first look at the new web-sharing economy
• Defining work in the digital age: an analysis by GigaOM Pro
• How consumer media will change in 2013

And, since launching in 2011, San Francisco-based Zaarly has seemed like one more startup competing with that crowd. But with a new feature rolling out Wednesday, the company is pulling away from those marketplaces of goods to really define itself as a marketplace of people.

Storefronts of people

Starting with San Francisco (but quickly moving on to other U.S. cities), the company is letting sellers on the site create “Storefronts” that showcase their talents and the goods and services they can provide – from a day of gardening to a hand-delivered homemade pie to a private yoga session.

“There are all kinds of cool things that are going to happen in the local space,” said founder and CEO Bo Fishback. “What we found in the last year is that this zone – finding talented people around and hiring them to do something great for you – this is where magic happens on Zaarly.”

As opposed to other local marketplaces that focus more on items that people want to sell, Zaarly has always listed items that people request, as well as goods and services people in a local area can provide. As some have said, it’s like a “reverse Craigslist,” which is compelling because you can ask for almost anything. But one of my chief frustrations with the site has been the difficulty in browsing for available goods and services and discovering possible items to ask for.

With the new Storefronts feature, that desire to browse and discover is satisfied, as you can scroll through dozens of people in a neighborhood (there are about 120 in the San Francisco area) across ten categories (including baking and cooking, custom creations, home repairs and lessons and learning) to see the kinds of things you can buy on the site as well as get inspiration for things you might want to ask for.  Sellers in different areas can apply to be showcased in a Storefront and Zaarly selects the best ones and then works with them on photography and marketing.

The importance of location, location, location

Even though the company’s Storefronts help distinguish it from competitors in local commerce, it will have to continue competing with historical rivals. And, with its new focus on people, Zaarly is a bit more competitive with services like errand-outsourcing startup TaskRabbit. But Fishback said Zaarly’s focus is more on helping people find specialists in their local area, not just anyone available to complete tasks. In some categories (custom creations, for example) Zaarly also competes with Etsy now, and Fishback said some sellers on their site use both platforms. But he added that while buying on Etsy doesn’t require that the buyer and seller actually meet, Zaarly’s platform encourages more in-person exchanges and communication.

Fishback said that when they launched the site, they didn’t have the vision for the Storefronts, but knew they wanted to create a local marketplace that prioritized people and transparency. When they added user profiles last March to downplay anonymity, he said, they realized that they had stumbled onto something promising and the Storefronts addition grew from there. Since launching, Zaarly has raised about $14.1 million and attracted just under half a million users. In the last year, it’s processed about $40 million in requests, the company said.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Flash analysis: Collaborative consumption – a first look at the new web-sharing economy
• NewNet Q2: Google closes the quarter with a bang
• GigaOM Research highs and lows from CES 2013

Yes, startups like Karma (which was purchased by Facebook in May), Wrapp and Boomerang already use Facebook as a platform for sending tangible gifts and experiences to friends. But Washington, D.C.-based Treater, which Wednesday launches to the public, doesn’t want to focus on formal occasions (as the aforementioned rivals do), it wants to offer a platform for sending casual, impromptu  gifts.

“It’s all the little things that are a little bit more meaningful than a like or a post to show you’re thinking about somebody,” said CEO and co-founder Jeff Ross.

In addition to coming out of beta, the company is announcing that it has raised $2.5 million in seed funding from several funds and angel investors. As part of the round, the company will add to its board Fred Schaufeld, managing director of SWaN Investments and founder  of NEW Asurion Corporation; Jack Davies, founder and former president of AOL International; and Gene Riechers, former general partner at Valhalla Partners.

In broad strokes, the service seems to work much like Wrapp and Boomerang.  Users select the Facebook friend  they’d like to send a gift and, through the platform, they can notify the recipient of the gift.  But while Wrapp and Boomerang are focused on higher-ticket items (with the former partnering more with national retailers and the latter working closely with local merchants), Ross said Treater is focused on lower-priced items, such as Peet’s coffee from Peet’s or a Chipotle burrito.

By zeroing in on the lower-value items, Ross said, the company hopes to expand the circle of friends to which people might gift from a handful of people who might get a $100 present to dozens who could receive $5 gifts.

Once gift-givers select a friend and an item to gift – from a cupcake or beer to movie tickets or a lunch – as well as a personal note, Treater sends a message to the recipients smartphone via Facebook wall post, text message or email. To redeem their gift, recipients show the “treat card” (a one-time-use credit or debit card) on their phone. Treater takes a cut of the transaction. Some of the merchants who accept treat cards include Peet’s Coffee, Caribou Coffee, Cosi, Chipotle and Urban Outfitters.

For gift-givers, it’s an easy way of sending friends a “thinking-of-you” treat.  And, for the merchants, it’s an interesting way to use social media to drive commerce and traffic, without discounting goods and services. I’m curious to see if Treater can encourage more spontaneous gifting, as that seems to be its biggest point of differentiation. But the startup is is entering a crowded field and, while its rivals play up formal occasions, they could easily shift their positioning. In addition to Wrapp, Boomerang and Karma, Starbucks offers consumers a way of sending redeemable digital gifts to Facebook friends, and CashStar and SocialGifts enable other retailers and chains to do the same.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• NewNet Q2: Google closes the quarter with a bang
• Social 2013: The enterprise strikes back
• Social media in Q1: commerce and discovery dominated

The big news will be Square’s loyalty and rewards system, which allows merchants to create digital punch cards for users, rewarding them for their first visit and continued patronage. Square Register, Square’s iPad business app, had a very simple reward system before, but it involved informing a business owner how much a user had purchased, giving them the option of choosing when to surprise their customer with a loyalty gift. Now, users will be able to get a punch card in their Pay with Square mobile app for each participating merchant and can chart their progress toward their next reward. Merchants can get users in the door by providing a percentage discount or a free item with their first purchase. And for regular customers, they can reward a set number of visits or total spend.

Square Register merchants will be able to get better analytics on sales, with item level reporting broken down by hours and time of day or week. Businesses can also see how sales are doing by employee shift. Inventory management features also been improved, enabling merchants to easily create categories of items, making it easier to handle greater quantities of products. Square also offers easier discounting of products, so merchants can set a percentage or dollar discount on any item. The Pay with Square app has also gotten a redesign to better highlight local merchants and make it easier for customers to discover businesses that take Square.

Keith Rabois, Square COO, told me in an interview that the new tools are part of Square’s larger vision to build out its services, which it plans to do all in-house. He said the goal is to build a seamless set of services that don’t require a lot of training or manuals for merchants to make them work. That echoes a recent interview I had with Rabois, who said that Square is working on improving its business tools for merchants.

“We want to solve problems that are universal and we’re reviving commerce from a payer and merchant perspective,” Rabois said. “Our vision is to fill out the entire package and it just works out of the box. All of you’re entire business needs are filled by Square: payments, analytics, loyalty, all of that inventory management we do for you so you don’t have to think about it.”

The new improvements are a logical and necessary step for Square, which has grown to serve 2 million businesses and individuals, and is now processing $6 billion on an annualized basis. Most of Square’s users are very small merchants, some of whom are just happy to have a way to accept credit cards. There’s still going to be a lot of growth in that market, but to really start making more money and expanding its reach, Square needs to have a full array of tools that can bring in bigger businesses. That’s where other competitors are trying to compete with Square, by offering more robust services that can meet the needs of merchants with bigger inventory, more locations or more complex business needs.

The loyalty system makes a lot of sense for Square and it puts it into competition with a bunch of other dedicated loyalty start-ups such as Belly, Cardify, Mirth, LocalBonus, Mirth and others. And it helps it keep pace with bigger local commerce competitors such as Groupon, LevelUp, PayPal Here, Foursquare and others, who are building out their suite of services to include payments, loyalty, deals and discovery.

As I wrote before, I think a number of these applications will converge as they try to become a one-stop shop for merchants. Competitors will eventually have to offer a whole list of services, providing deals for demand generation, loyalty for continued engagement, analytics and inventory and payments to close the loop and track spending. Square still faces a number of challenges as it moves up market and tries to convince bigger merchants it can get the job done for them. But it’s increasingly building out its payment tool to become a more versatile resource for merchants.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• NFC will be driven by marketing and loyalty, not payments
• The future of mobile: a segment analysis by GigaOM Pro
• How consumer media will change in 2013

Signpost works by giving local businesses a customized online marketing campaign that is designed to help them drive more sales and gain repeat customers. The company works with more than 1,200 publishers such as Google Offers, EveryDay Health and AOL Patch and places ads and deals on the sites that can be tracked back to clicks and purchases. The company has tried to position itself as an AdSense for local commerce with its one-stop shop approach.

In addition to the money, Signpost has also picked up Christopher DePatria, former head of sales at AOL’s Patch, to be the company’s new VP of revenue. The company, which previously raised $1 million from  Google Ventures, Spark Capital and angel investors, is planning to continue building out its tech and sales team and expects to grow from its 24 people to about 40 employees with this latest funding.

Stuart Wall, Signpost’s CEO and founder said the company is a good fit for many local businesses, who often spend money on building general awareness on local websites. Signpost works to connect its marketing with measurable actions, with an eye toward ultimately drawing in high quality customers. While it does work with daily deal companies, it tries to find discounts and offers that a company can afford to provide. For 94 percent of Signpost customers, they’re getting better cost per impression, cost per action and cost per clicks than Yelp, Google and Facebook on a monthly basis, said Wall. Even with a $99 a monthly fee, 93 percent of clients renew each month.

“The idea is you get the benefit of working with every platform we have and we optimize things for you and we’ll focus on your online marketing campaigns,” Wall told me in an interview.

Signpost has a good bead on this market. Local businesses are looking to tap online marketing but they’re often not very savvy about how to go about it. Taking care of the marketing work and finding the right channels to advertise on solves a lot of headaches for merchants, who are getting increasingly inundated by salesmen looking to get them to advertise or offer deals through their services. I like that they’re not always pushing big discounts and Wall agrees that’s not necessary for many businesses. It’s more about finding the particular needs of a merchants and then seeing what they can afford to spend. And it all leads back to real results.  That sounds like a service that’s got plenty of appeal for local businesses.

Image courtesy of Flickr user Neal Dench. 

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Social third-quarter 2012: analysis and outlook
• NewNet Q4: Platform mania and social commerce shakeout
• NewNet Q4: Platform mania and social commerce shakeout

Tagtile offers a customer loyalty system for merchants built around a small, free box equipped with a sensor that allows consumers who have downloaded the Tagtile app to tap it with their phones. Users are able to receive loyalty points, offers and rewards from the merchant and easily share about the business on Facebook or Twitter from their phone. It’s a simple way to establish a user’s location at a business without asking them to do an actual check-in. And it can be easy way to get a consumer to share about a store through social channels in exchange for a deal or reward. TechCrunch wrote about the service when it launched a pilot in October and what was interesting at the time was that the service utilizes unspecified sensors in the phone to register a tap instead of using near field communications or NFC.

The deals makes sense as Facebook, like many others, are looking to tap the huge opportunity in local commerce. Facebook on Friday coincidentally expanded its roll out of its beta Offers service to a limited number of businesses in Australia, Japan and a few other countries. Brands and businesses can run offers on their pages for free and can push out out offers on other parts of Facebook for a fee. Users who claim an offer can get it forwarded to them for redeption online or in-store use.

Having a company like Tagtile will give Facebook more expertise about how to approach businesses and convince them to use a valuable service for engaging with their customers. If it can tie its online offers to Tagtile’s service, it will give businesses a way to redeem those offers in-store and show them how effective their offers were. But I’m not sure how much of the acquisition is really about the TagTile box long term. NFC phones are coming, and you can already establish a user’s location inside a store and reward them with QR codes. Foursquare is doing this through check-ins and Shopkick is as well through its dedicated audio hardware.

This highlights just how busy this market–delivering offers and enhancing loyalty via mobile devices–is going to be. Most of the mobile payment services will also be offering some form of deals, coupons and rewards. That’s going to be a key way to entice people to use a mobile payment system. This might be a stretch, but if Facebook ever decides to pursue its own mobile payment offering, the experience and intellectual property of Tagtile might be helpful. Facebook is doing more with its credits and there’s the potential that at some point, it will want to get into the mobile payments game.

But overall, it shows that Facebook is thinking more about mobile, one of its blind spots. While the acquisition of Tagtile is nothing like Instagram, it again highlights the importance of mobile devices to Facebook. And the purchases show that Facebook is ready to open its pocketbook to gain ground in this critical area.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Facebook’s IPO filing: ideas and implications
• Connected world: the consumer technology revolution
• Flash analysis: the future of Yahoo

For background, Loopt was one of the early pioneers in location with its ability to let friends track each other passively. It later took on features like check-ins, incorporated deal discovery through Groupon and Living Social and let people get reviews and tips on venues.

Altman told me that over time, Loopt focused more on deals and loyalty and was looking more at the intersection between location and payments and commerce. That’s why it was open to being acquired by Green Dot, which sells and reloads prepaid cards at 60,000 retail locations and recently bought a small Utah bank.

“We needed to figure how location could be more closely tied to finance and payments. What makes location compelling is not just discovering deals but helping people make purchases,” Altman told me. “We knew we needed to partner with a company such as Green Dot. They have a lot of things they want to do and we will take what they have and help build the most innovative finance service out there.”

Altman said the future of location-based services is increasingly about commerce. That’s behind some of the acquisitions in the location space, he said. Groupon bought Pelago in order to bring together consumers and local discount offers. EBay bought WHERE to help bolster PayPal’s ability to deliver location-based offers to consumers with PayPal closing the loop on redemptions.

As I wrote earlier, mobile wallets and location-based offers go hand-in-hand. You need a reason to turn to a mobile wallet both for consumers and merchants, and a personalized and location-based deal service is one way to provide that value to consumers and help walk customers in the door for merchants.

“If you look at companies that made the acquisitions, eBay, Groupon, the common thread here is companies that are in the finance and payment industry. Many companies are realizing the powerful combination of location with payments and finance products,” Altman said.

But Altman said while he can’t talk about what Green Dot and Loopt will work on, he said it’s not just a mobile wallet, which he finds unexciting by itself. He hopes to build something much bigger than just a wallet. But he said this combination of commerce and location will be the most impactful thing to emerge from the location space.

In that light, it’s not surprising that Green Dot bought Loopt. Loopt has been working in this area for a while and has patents that are helpful for mobile marketing. Location leader Foursquare is also moving in this direction with its Explore function helping users discover local deals. It has also signed a partnership with American Express to link Foursquare deals to a user’s credit card. SCNVGR, another location-based start-up, has also been exploring the link between place and payments with its LevelUp service, which has its built its own mobile wallet from the ground up. Google Wallet is closely tied to Google Offers for local deals.

As Walt Doyle, CEO of WHERE, recently told me: “If you only enforce payments without content advertising or offers, it’s simply not compelling from the acceptance side or from the consumer side.”

There will be other compelling uses of location aside from commerce. But that seems to be the big play right now and for anyone building a mobile wallet, you need to think location-based marketing and deals. And for location-based services, the most promising way forward is linking to commerce.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• The future of mobile: a segment analysis by GigaOM Pro
• A near-term outlook for the mobile app marketplace
• Defining the mobile wallet: what it is, why it matters

The result is a new iPhone app called Kapture that lets merchants, businesses and brands reward loyal users for sharing pictures of a business or product on Facebook. It’s taking a habit that many consumers already do – taking pictures of meals and establishments – and giving merchants a way to leverage that as a marketing channel and also build a better relationship with their customers. And it lets consumers benefit from their interest in certain businesses and brands.

“We created Kapture to take this experience that people already know – taking pictures and sharing them – and we asked: why not reward users for sharing this with their friends,” said Szewczyk. ”With Kapture, the individuals visiting a business become their social media troops in a way.”

Photos ops offer rewards

Kapture is starting at 25 businesses in New York including the Gansevoort Park hotel and Battery Place Market and has many more lined up to go soon. The merchants offer a range of small discounts and free items for users who take a picture and share it on Facebook. For example, Gansevoort Park is offering a free glass of champagne for people who take a picture at its rooftop bar. Spin Ping Pong is also offering a free drink for a picture of a user’s game. The pictures gets stamped with a water mark from the merchant and link back to a landing page from Kapture that tells where it was taken and provides information on any discounts. The Facebook posting itself doesn’t include any discount information so it appears like a regular update.

The app allows users to see what “photo ops” are nearby and when they get to a participating location, they can take a picture through the app. They can then tag friends, share the picture directly to Facebook and then receive a coupon, which they show to employees. Kapture plans to extend support for Android and Twitter next year. Kapture doesn’t actively try to ferret out fraud but does include a button to report abuse. Szewczyk said social pressure on Facebook should also curb people’s desire to spam their friends using Kapture.

A tool for merchants
Szewczyk moved to the Bay Area from New York two years ago to be part of the founding team on Qwiki, which presents search information in short multimedia presentations. He was excited to return to New York and get started on his own venture, which is now up to 7 people. He is in the process of still raising seed funding and has gotten investments from Qwiki CEO Doug Imbruce and COO Navin Thukkaram. He’s also signed on some notable advisors including Serkan Piantino, who is leading Facebook’s New York engineeing office and Alexia Giles, principal of new business development at Google.Merchants can set up their own Kapture account online through a dashboard and set their rewards and what they want users to do in the picture. They can also determine how often they want to run rewards and how many they want to offer each day. Business owners will have a Kapture sticker they can put in their window and they can also put up signs directing people to specific discounts and the app.

Leveraging user generated content

I think Kapture is a smart idea that can be a helpful tool for merchants if it can scale up. Business owners are getting bombarded with offers from companies like Groupon and Living Social. But those deals often require them to offer steep discounts with sometimes half of the revenue going back to the deal provider. That can be helpful for some businesses, who want access to email lists from these deal providers. But for many merchants, they already have an avenue for getting the word out: their own customers. If they can better leverage their existing fans, they can market to a wide audience without having to offer big deals. Using photos is also smart because it’s an action that people already do. I just took a photo of a dish I had in Brooklyn just because I liked the meal. Getting rewarded for that might push me to come back and it would definitely make me appreciate that restaurant more.

CEO Michael Szewczyk

This is a growing opportunity, helping merchants and retailers leverage social actions and user generated content. I recently wrote about Social Passport, another New York company that lets people use QR codes and NFC on their smartphone to trigger social actions such as liking, following, checking-in or posting about a business. Piictu, yet another New York company, launched publicly in September and offers users a way to have conversations through pictures. The company said it sees a way in the future to help brands sponsor picture conversations on Piictu and help create user-generated content. Szewczyk said pictures are just the first step for Kapture, which will eventually become more of a platform for leveraging all kinds of user generated content.

Long term prospects

Kapture still has a ways to go and there are all kinds of companies looking to capture the local advertising budgets of merchants and retailers. And I wonder if this will be a feature that other competitors will try and incorporate into their products. Facebook and Google could also be interested in picking up Kapture if it gathers steam, especially considering their advisor connections. But I’d like to see what Kapture can do on its own. It’s got an interesting take on user generated content and could be a good tool for merchants looking to make better use of social media.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• 12 tech leaders’ resolutions for 2012
• NewNet Q2: Google closes the quarter with a bang
• Social Media in the Enterprise

Hey, big spender!

Shopkick, which has 2.5 million users, will now let users link the mobile application with their Visa credit or debit card, which will tie into a new “buy and collect” program. Now users will get kick rewards for visiting a store or scanning an object as well as additional rewards, such as “spend $40 and receive 250 kicks.”  Shopkick will deliver notifications to users about offers after Shopkick has established a user’s presence in the store. Visa will use its real-time messaging platform, which it deployed first with the Gap earlier this year, to send a confirmation about qualifying purchases after a transaction. Retailers can also offer kick boosters that increase the amount of rewards if a user buys a certain amount.

Shopkick and Visa are implementing “buy and collect” with American Eagle Outfitters, Arden B., Old Navy, Toys “R” Us, and Wet Seal. Shopkick, which is used at 4,000 stores, expects many more of its retail partners to join the program.

Users who check out and pay with their Visa card will get an instant text in-app message notification that their kicks have been banked. They will also be able see other retailers nearby who are offering “buy and collect” offers. Retailers will benefit not only by encouraging more purchases for higher amounts but also by getting clear data on how successful their efforts are, because the promotion and transaction can all be tied together through a swipe of a card. And they can also get aggregate data on the number of people who redeem their rewards. Shopkick said it won’t provide personal data on which specific users take advantage of “buy and collect” because of its existing privacy policy.

Instant rewards programs equal more data

Shopkick CEO and co-founder Cyriac Roeding said rewarding and incentivizing actual purchases was part of the original plan for Shopkick. Now, with Visa, it is able to create an instant reward and loyalty program for any retailer. The Visa integration can be set up within an hour and doesn’t require that a merchant buy the necessary Shopkick signal equipment that establishes a user’s location inside a store. The goal, though, is to get retailers to sign on to the whole package.

For Visa, the most popular credit card, this is another way to provide more help to its retail customers and also drive more transactions for its financial customers. This is also another sign of how the credit card companies can play a big role in providing rewards and can enhance loyalty programs for retailers and merchants. With the Gap, Visa showed how it could deliver targeted offers via text message to Gap customers who opt in based on their location, time of day, spending habits and where they recently shopped at. American Express is also experimenting with retail transactional data with Facebook, Foursquare and SCVNGR.

Roeding said Shopkick is looking at allowing retailers to tie their current loyalty programs into the Shopkick app, which would allow users to communicate with their favorite stores through the app. That might help retailers with retention and engagement by working off the Shopkick platform. Roeding said the average Shopkick users open the app 14 days every month, and each day they open the app, they view 16 stores on average.

There’s always a cost . . . for someone

Shopkick is showing that it has a powerful platform for merchants to drive loyalty. But it’s been a little complicated proposition for merchants, who have to install the Shopkick equipment in each retail location. But now, if Shopkick can offer a way to reward real sales and encourage bigger purchase amounts, it makes it easier for retailers to get on board. This is also a way to quickly snag merchants, who can start with “buy and collect” and then move up to the full package.

I think retailers should find this appealing. They have a need to drive traffic and sales, and they are increasingly looking to leverage mobile tools like Shopkick, RedLaser and ShopSavvy. But they must have a way to ensure their marketing spend and their mobile initiatives are providing a clear return. Visa is stepping up and showing that with its payment network, it can be the one to not only close the loop but also provide the consumer feedback and outreach necessary through real-time messaging. As we have mentioned, commerce is being remade through mobile devices and various shopping apps. But it can take an old power like Visa to make some of this stuff to come to life.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Mobile shopping follows the yellow brick-and-mortar road
• The future of mobile: a segment analysis by GigaOM Pro
• Social media in Q1: commerce and discovery dominated

As Google and Isis, the carrier-led joint venture, bring forward new NFC-based payment systems and PayPal builds its own in-store solution for payments that leans on other methods besides contactless, they’re increasingly looking to VeriFone to make sense of it all for merchants, which are confused about how to handle this transition to alternative payments. The thinking by VeriFone, Google, PayPal and others is that VeriFone can help lead merchants and retailers through this transition by becoming a managed services provider, not just a payment system seller, VeriFone CEO Doug Bergeron told me in an interview.

By helping integrate these new payments models into the existing systems of merchants, VeriFone can be an independent third party, a “Switzerland,” said Bergeron. He said VeriFone can make all the alternative payment systems and their new discounts and loyalty features work through point-of-sale hardware merchants are familiar with.

“We’re realizing our customers need more than just our products; payments is [sic] getting too complex for them and they need ongoing service. They need someone to manage not only credit card acceptance and security but all the new stuff that will co-exist like Google Wallet, Isis, and PayPal and Groupon. Retailers want the ability to keep current with all this stuff  but they can’t hire an IT team.”

VeriFone CEO Douglas Bergeron

That’s where the purchase of Point comes in. Point — which offers point-of-sale technology and support, payments gateway services, card encryption services, and multi-channel e-commerce processing – has the biggest footprint in Europe with 475,000 merchant contracts, which will no doubt extend VeriFone’s existing business. But really critical in the pick-up are Point’s services business and technology.

Point doesn’t just sell terminals; it provides merchants with ongoing security, compliance and technological capabilities, as well as other mission critical service. That fuels a recurring services model that will add about $260 million in sales over the next 12 months to VeriFone. VeriFone plans to use Point’s technology and business model in other markets where payment systems are mature to help retailers make the transition to alternative payments.

VeriFone said with the addition of Point, its services revenue will grow from 20 percent this year to 30 percent in fiscal year 2012 and will hit 50 percent of revenues by 2015. By that time, services will represent a $1.5 billion business, including rentals. If all goes according to plan, the company will become a services provider, delivering remote support and help in connecting these new payments solutions with a retail business’ system and ultimately with their banks.

This strategy isn’t without risks. Standard & Poor’s lowered its outlook on VeriFone Tuesday based on the debt it was taking on for the Point deal and the integration risks. And it’s unclear if VeriFone is being too optimistic in its belief that merchants will turn to it for managed services. But this is where VeriFone is ultimately going as it tries to become a full-blown resource for merchants and retailers. That’s the motivation that went into its recent purchase of Global Bay, which helps retail employees connect with consumers on the sales floor through mobile devices and provides software that ties into inventory systems and online commerce sites. Bergeron said merchants are increasingly going multi-channel, blending online and offline commerce, and they need more help in doing that.

It shouldn’t be a surprise that VeriFone is poised to capitalize on payments. It has been around for years and has a huge footprint in the U.S. with its point-of-sale terminals. But it’s making some bold decisions to grow beyond the point of sale, getting on to the sales floor with mobile devices like its PAYware card swipe tool and with Global Bay’s software and creating a services business that can provide a lot more recurring revenue. It’s hard to say which digital wallet and alternative payment system will win out. And VeriFone doesn’t connect to other mobile-based solutions like rival Square. But with its latest moves, it seems VeriFone will do quite well as the payment landscape goes through a lot of upheaval in the coming years.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• The future of mobile: a segment analysis by GigaOM Pro
• 2012: the year of confusion for NFC payments
• NFC will be driven by marketing and loyalty, not payments