The Power of Velveeta: Shopkick Announces 3 Million Product Scans

Sleeper location-based service Shopkick is quietly amassing some impressive numbers. Its users are still small, at about 750,000 compared to Foursquare’s 5 million users, but those users are doing totally different and far more monetizable things.

Ten percent of users use the app every single day, and later today Shopkick will announce a new milestone: Users have scanned more than three million products at 250,000 locations nationwide since its  August launch. Compare that to TechCrunch Disrupt finalist CheckPoints, boasting 600,000 barcode scans.

Participating brands include Kraft Foods, Procter & Gamble, Unilever, HP and Intel. It’s a big range of lifestyle products, similar to the range of participating retailers, which includes Target, Best Buy, Macy’s, Wet Seal and American Eagle. And to consumers and brands, that’s a big part of what makes Shopkick unique as a loyalty program. “It’s not just focused on food and grocery, it’s focused on the consumer’s entire life,” says Ed Kaczmarek, director of innovation at Kraft Foods. “They can get Kickbucks at Target and go back to Target to redeem them, or they can go to Macy’s or Best Buy to redeem them. It’s more integrated into everything the consumer is doing.”

Shopkick is different that other location based services for a few reasons. Its raison d’être isn’t to be social, it’s to help shoppers get greater rewards for loyalty behavior, not to mention rewards that can be shared across multiple retailers. But it also gives retailers a box that counts a check in only when someone is actually walking into the store, not checking in from the taco truck across the street.

The case for what consumers get out of it is pretty clear, and the case for what stores get out of it is pretty clear. But the case for brands is less clear, and that’s one reason Shopkick is spending a lot of time on it. A vice president from P&G is spending a year in Shopkick’s Palo Alto office, giving feedback on ideas, while brands like Kraft are trying different promotions with Shopkick to figure it out for themselves. At a minimum they know more than they knew before about who is physically picking up their product, and once it’s scanned, they can deliver specific promotions to that person’s phone like recipes or coupons.

Kaczmarek says they helped push cheese-related products by showing deliciously fattening recipes for Superbowl parties leading up to Sunday’s game. (I’ll admit it. I didn’t even need the nudge to whip together some Velveeta and Rotel. You can take the girl out of the South…) “If we can bring our brands front and center while the consumer is in the store, it’s almost like having a billboard in front of them while they’re considering what to purchase,” he says. He adds that it’s already at least as effective as other social media programs Kraft has done over the last few years.

Brands and retailers pay Shopkick a fee when Kickbucks are offered and can chose to offer more Kickbucks to juice certain behaviors. It’s not too different from companies allocating part of their ad budgets to a promotion over Groupon– it’s more targeted, with a clear call-to-action and far more measurable than other forms of advertising. The numbers should help Shopkick continue to get more brands and stores on board. Now that founder Cyriac Roeding has landed Target, the next big kahuna is  a fast food giant.