While marketers increasingly look to harness location, most of the work is aimed at zeroing in on where people are out and about on the street. But there is a big opportunity in targeting location indoors, tailoring messages to the exact position of users as they browse aisles and roam through stores. That’s what Point Inside, a start-up from Seattle, is looking to tap with the launch Tuesday of nSide, a new private indoor ad network for retailers.
NSide builds off the work Point Inside did in helping create the Find-It application for midwest retail chain Meijer. That app helped consumers locate items in a store and plot their shopping route while providing weekly specials and product promotions. With nSide, retailers will be able to send targeted ad messages, coupons and content based on a user’s location within a store, their shopping route, their browsing history and shopping lists.
Retailers embed Point Inside’s nSide technology in their mobile apps, which enables their users to create shopping lists, see specials and find items in the store. When a customer goes to the actual store nSide takes their browsing patterns, shopping list items, and purchase history if available and matches it with their exact location and expected path inside a store to offer up relevant deals or coupons from the retailer and its brand partners. For instance, if a user is planning on buying flour, nSide can offer up a coupon or ad for cookie dough nearby. As the customer heads to the next thing on their shopping list, nSide can suggest another thing to buy that matches their preferences or their location.
The ads are not static banners. They will be incorporated into the shopping list or show up in search results while in the store. Or they will appear on a store map when a user is next to a promoted product. And it’s not just ads and coupons; retailers can offer up how-to videos, recipes and other content.
Josh Marti, the CEO of Point Inside, said nSide allows retailers and brands to engage consumers inside the store at critical moments when they’re looking to buy.
“With the private ad network, retailers can maintain control, keep an integrated experience and open deeper channels of communication while making money through brand spending,” said Marti.
Marti said retailers have been mistakenly shrinking down the buying experience to fit mobile devices. But he said the real opportunity involves building a physical representation of the store for mobile, enhancing the way people are able to shop-in store using their smartphones. Consumers are increasingly using mobile apps to do research in store before buying online, turning stores into showrooms for online retailers. But Marti said retailers can use technology like nSide to keep customers engaged and buying in-store rather than resorting to online channels. If a store has a loyalty program, nSide can integrate its buying data to better target future ads and close the loop on in-store redemptions. Point Inside is launching nSide with the Meijer chain and expects to have more retail customers on board later this year.
The nSide network also allows retailers to turn to brands for new advertising revenue. Brands that might send out coupons and ads for hundreds of products in a week can work with nSide enabled-retailers to push a much smaller number of products to the most receptive potential customers. Marti said brands that use nSide can boost their click-through rate on ads by three to five times. While consumers buy a lot of the same items each week, about 20 percent of their purchases are impulse buys, said Marti. He said that’s a ripe opportunity for brands to cut through the noise and get their message out to the customers most interested in hearing about certain products at the time they are ready to buy.
Point Inside uses Wi-fi and sensors such as gyroscopes and accelerometers to establish a user’s exact location inside stores in relation to specific products on the shelf. As we’ve been noting lately, this type of indoor mapping and location finding is a growing opportunity for big players like Google (s goog) and Microsoft (s msft) and smaller technology companies that are trying to help make indoor location more accurate.
I like what Point Inside is doing. It’s offering retailers a way to keep their customers inside their store and enhances the buying experience. But there are dangers in pushing too many ads to users, especially ones that aren’t relevant to shoppers. NSide will have to be very targeted, accurate and restrained to make consumers comfortable with the idea of forking over their purchasing and buying intent data and basically getting tracked around the store. But if done well, there’s an opportunity for retailers to make mobile apps really work for them in-store. And as more advertising dollars shift to mobile, this could be a way to supplement their revenue.