Sears Holdings Corp.’s Kmart is turning to location-based mobile initiatives to encourage consumer loyalty and repeat purchases during the holiday season.

Kmart recently became a featured retail and product partner with the CheckPoints mobile shopping application. The department store chain will offer incentives to consumers for checking-in to their stores and checking out specific products on their shelves.

“Overall, at Kmart we’re committed to provide choice and convenience to our customers,” said Tom Aiello, division vice president at Sears Holdings Management Corp., Hoffman Estates, IL. “Our partnership with CheckPoints is an extension of that commitment and further empower our customers to shop how they want, when they want and where they want, helping them better manage their lives.

“And rewarding customers who shop at Kmart is just another way to provide them more choice and value,” he said.

“For example, the customers who visit Kmart and check in to earn points that are redeemable for goods and services, and especially around the holidays, the points offer a convenient way for customers to shop for additional savings.”

Kmart ramps up mobile for the holidays
Mr. Aiello said that whether customers shop through the company’s Sears2go and Kmart2go applications or through each retail brand’s mobile site on their smartphone device, mobile platforms provide a fast, convenient way to shop while on the go.

The applications have complete access to the full list of items and categories available on Sears.com and Kmart.com.

Customers can search, browse and buy directly from their phone, then have the order shipped to their door.

The new, enhanced features on the mobile applications let customers share and tweet their purchases with friends and family.

With location-based services, customers can find nearby store locations, hours and contact information.

On the mobile Web site, time-starved customers can now use the buy online and pick up in-store feature, which is powered by mygofer, for instant gratification on their purchases.

Mr. Aiello said that mobile shopping is what the Internet was ten years ago and is growing at a faster rate.

Sears and Kmart are betting that the popularity of “buy on mobile, pick-up in store” to continue to grow more popular in the retail sector as mobile devices are able to give customers all of the research and product reviews that are available online.

“At both Sears and Kmart, we’re continually working to bring the in-store experience to the Web and smartphone devices for customers who prefer to shop online or through one of our mobile apps,” Mr. Aiello said. “Through our hard work, we’ve been able to establish a unique digital connection with our customers—and in return, it is our customers who are driving our online innovation based on their invaluable feedback.

“A good challenge is how technology continues to evolve at a fast clip, and customers adopt that technology at record rates,” he said. “We launched iPhone apps, then a mobile-friendly WAP site, Android, Blackberry apps and now iPad apps.

“Sears Holdings is committed to keeping pace with these technologies and providing choices to our customers.”

Mobile rewards drive purchase intent
CheckPoints LLC claims to be the fastest-growing shopping application to date, surpassing 100,000 downloads in its first three weeks.

The product discovery engine launched in October with major CPG partners such as Unilever, Tyson Foods, Belkin and Energizer. It offers real rewards to consumers for scanning bar codes, with no purchase necessary.

Available for free in the Apple App Store, CheckPoints incentivizes consumers to enter retail locations as well as discover consumer product goods by allowing them to earn points redeemable for real-world rewards.

CheckPoints will launch in the Android Market later this fall. 

When customers open the CheckPoints app at Kmart, they check-in using the application’s GPS technology to earn CheckPoints instantly redeemable for in-store rewards, as well as airline miles, gadgets or gift cards.

Users accrue even more points by scanning the bar codes of featured menu items. 

CheckPoints combines GPS, HTML5 and UPC code scanning technologies on smartphones to help customers discover featured products and encourage brand loyalty.

Its customers earn points by scanning bar codes on featured products and by playing bonus mini-games.

CheckPoints are a universal currency, meaning points accrued from a specific product or place are not limited to redemption from that brand.

CheckPoints spreading its reach
Most location-based applications focus on solely on the social aspect: connecting people with locations.

CheckPoints adds the missing link—product—to get Kmart customers in the door and discovering new products. 

Kmart is using CheckPoints in multiple ways to better engage with consumers.

First, Kmart can connect with users as they walk in to the store to show special offers or connect with the user via Facebook. No in-store implementation is required.

CheckPoints works in any Kmart location in the country, without the need to install complex technical devices.

Second, Kmart has several proprietary brands, including Craftsman, Land’s End and Joe Boxer, that can leverage CheckPoints to drive foot traffic and engagement.

Currently consumers can walk into any Kmart and scan products by Frito-Lay, Unilever, Energizer, Tyson Foods and Belkin, among other brands. 

Finally, Kmart is leveraging CheckPoints’ universal loyalty program to let consumers to redeem their points for “Shop Your Way Rewards” and receive instant savings on their Kmart purchases.

“Overall, consumers will spend more time in the Kmart store and discover additional products that are relevant and helpful to them,” said Mark DiPaola, cofounder of CheckPoints, Los Angeles.

“Because consumers can earn CheckPoints in over 500 times as many locations as the competition, CheckPoints has been able to add users at at record-breaking rate—over 100,000 in its first four weeks,” he said.

“These users are highly engaged, using the app almost three times a day at any location they shop at—not just a select few.”

Mobile social coupons
Kmart is also partnering with First Data Corp.’s eGift Social to distribute coupons across Facebook’s online and mobile platforms.

“EGift social enables Sears to provide a solution that allows their customers to send gifts via expanded communication channels such as Facebook,” said Sarah Owen, vice president of mobile applications and loyalty solutions for eGift Social at First Data, Atlanta.

“Consumers use social networks such as Facebook to communicate with and virtually participate in their friends’ lives,” she said. “Consumers want to be able to react to their friends’ status on Facebook by sending a real-time message.

“EGift Social enables consumers to attach a gift to that message thereby increasing the level of thoughtfulness.”

Final Take
Dan Butcher, associate editor, Mobile Commerce Daily