GigaOm Pro has again tapped Laurie Lamberth to share her analysis and insights on the wireless industry, this time in a Research Note about the fresh set of location-based (LBS) consumer shopping apps that hit the scene in August, 2010.
While these announcements — including shopping apps Shopkick, ShopAlerts, AisleBuyer and Facebook’s scene-stealing Places service — all landed in the headlines within two weeks, they represent the crest of a location services wave that’s been building from some time. Significant LBS announcements within the past 18 months include an influx of Tier 1 venture capital, acquisitions of LBS companies by social networks, plus the addition of location-based services to existing social networks — and vice-versa.
Why is LBS so hot, all of a sudden? Two words: engage and monetize. These apps engage buyers in compelling new ways by mashing up their social networks, special offers, local business reviews and location-based games bringing friends, bargains, local knowledge and fun together at the best possible time for a retailer — the point of purchase. Once location-enabled sales begin flowing through retailer cash registers, there will finally be a pool of money that location providers can grab a slice of to monetize their networks. That pool is growing fast: ABI predicts that LBS will grow from $43 million in revenue this year to $1.8 billion in 2015.
Just because it looks like there’s finally a revenue model and engaging customer experience for LBS shopping apps doesn’t mean that they will be simple to implement. A number of challenges — privacy concerns, scaling issues and check-in integrity among them — provide a potential barrier to widespread adoption. Overcoming these obstacles will enable retailers to find new ways to build customer value and loyalty, and transform the customer experience: “Think airmiles 2.0,” as social media blogger Joel Hughes put it.
The report also profiles 26 companies in the location-based apps space: Facebook, Twitter, Google, Loopt, Foursquare, BrightKite, Whrrl, Gowalla, Plancast, Groupon, AisleBuyer, Bizness Apps, Offeretti, ShopAlerts, Shopkick, Bakodo, Stickybits, Yelp!, Geodelic Sherpa, WHERE, MyTown, InCrowd, SCVNGR, Waze and Layar.
Read more: http://pro.gigaom.com/2010/09/shopping-matters-when-it-comes-to-location-based-apps/#ixzz10jyVLOZE
