After days of speculation, popular retail app Shopkick has announced that it is to come under ownership by one of the biggest mobile service providers in South Korea.
Reports yesterday (September 29) suggested that SK Telecom was close to securing a deal for Shopkick in the region of $200 million. Representatives from both companies have now come out to announce that a purchase and terms of an impending merger have been finalised.
Offline retail customers can use Shopkick to gain loyalty points when they enter and purchase at certain stores. Some of the company’s current partners include Old Navy, Crate & Barrel and department store giant Macy’s, which recently announced that it would be using Shopkick as part of an iBeacon roll-out across 4,000 stores.
Shopkick has only been around for four years but already sports a following of over eight million users. The free app’s early features included information on products in-store as well as a scanning function for gaining rewards at the checkout.
Now, the rewards - or ‘kicks’ - are more commonly delivered upon entry into a store through signals sent via Beacon technology. Loyalty points are collected by the app and available for trade in exchange for gift cards at participating vendors.
Boasting revenue of $26 million last year, the technology is now able to reward customers with deals from 20 retailers and 200 brands and SK Telecom is looking to use the app for boosting its stateside presence.
Through a purchase of Shopkick, SK Telecom will capture a significant chunk of the US mobile shopping market as well as an entry into the location-based shopping sector.
Analysts believe the deal falls very much in line with SK’s ambitions to expand in the US with an investment of between $500 million and $1 billion spread over five years.
But while SK prepares to enter uncharted territories, details of the purchase indicate that Shopkick’s existing management team and the company’s 75-strong staff roster will remain in their current roles.
Shopkick will also continue to operate in California, which is seen as a given considering SK’s need to build its US profile.