Will first generation customer experiences kill location based marketing?

A comment on twitter caught my attention last week…

Gap won’t honor their Foursquare discount unless you get credit card. No asterisk or anything on special. Won’t see me there for a while.

I’ve seen other complaints about location based marketing promotions being hard to redeem but what  caught my attention here was that this tweet didn’t come from anyone with a professional interest in location based marketing, it came from a woman that was just trying to get a good deal on a pair of jeans.  I.E.  A real end-user.

Much has already been written about early location based marketing campaigns falling short of an ideal customer experience.  The Ad Age piece “What Marketers Can Learn From Starbucks’ Foursquare Stumble” chronicles the poor customer experience some users faced when trying to redeem one of the largest scale location based marketing promotions tried to date.

So I spent the weekend testing out the offering of another location based marketing pioneer, ShopKick.  What I found was a number of gaps in the customer experience:

• Auto Check-In – The marketing buzz around ShopKick is largely due to the promise of “Auto Check-In” but in this case, “auto” means that while you’re in the parking lot, you need to remember to fire up the ShopKick app and then hustle through the door of your local Best Buy before the AutoLock on your phone engages or you get a phone call.  Even then, you have a 1 in 4 chance of auto checking in as the “pilot” is only in a quarter of Best Buy’s stores.  At this point “Auto Check-in” is a pretty cool proof of concept, but an end-user who expects ShopKick to free them from the Check-In fatigue they are experiencing with FourSquare, will be disappointed.
• Places Database – Unlike FourSquare I can’t create my own venues in ShopKick so I’m dependent on their database of stores being accurate, and it wasn’t.  I was able to check-in to an REI store that had moved to another part of town five years ago.  Accurate “places” based data for these services is going to be a real challenge, especially for those that don’t have a crowd-sourcing feature.
• Product Info – ShopKick lets you scan bar codes in the retail store to earn points and get detailed product info.  But today the info you get is less than what you can already find on the shelf, and in a Best Buy you can’t scan their proprietary 2D SKU code, or the new QR codes that are rolling out.  You can’t get access to product reviews from BestBuy.com, advice from Twelpforce, etc… Again a very cool concept but not yet a compelling execution.
• Promotions – ShopKick offers Coupons on specific products while you are roaming the store trying to collect Kickbucks.  But all the so called “Deals” are the exact same price that is available to every other shopper in the store!  It felt like Best Buy and ShopKick were trying to trick shoppers into thinking these were special prices.  This perceived misdirection is a customer experience FAIL.

I can understand why all these customer experience challenges with FourSquare, ShopKick, and others occur.  Doing ANYTHING with large retail chains is very hard.  Navigating the matrix of approvers, stakeholders, budgets, ect… can be all but impossible.  So before you go to the monumental investment of time and resources necessary to create a well integrated customer experience, it’s temping to cut some corners and get something out there quickly to prove the demand.  There is nothing wrong with this “Pilot” approach.

But, the corners you cut need to be the ones that are transparent to the end user.  Maybe you don’t have the automated back end to customer affinity so you get a weekly data dumps of slightly stale data to use in your app.  Or you can’t get the IT department to let you link to the store level product database, so you link to the publically available Best Buy Remix database instead to display product info and customer reviews.  The point is that it’s OK if the Pilot isn’t perfect, but the customer experience has to be “good enough” to excite the early adopters.

If the early adaptors don’t have a good experience the first time they try FourSquare, they aren’t likely to give it another chance.  Worse, since these location based marketing services cater to social networking early adopters, the cycle of negative PR that results will be greatly amplified.

You see this challenge every time a new technology tries to find a home in retail stores.  When technology companies first started trying to sell touch screen “kiosks” to retailers they were extremely expensive and unreliable (IBM and NCR should have bundled an “Out of Order” sign and wire transfer instructions with every unit they sold ).  It got so bad, that subsequent vendors couldn’t even call their products “kiosks” because the name had such a negative connotation with retailers.  Bloated, expensive, and proprietary “Digital Signage” solutions have that same problem today.

Ironically, FourSquare’s co-founder, Dennis Crowley, seems to understand the problem perfectly when he call’s Facebook’s new Places offering “boring and unexciting”.

I don’t want to see location based marketing deployments for retail hampered by early mistakes.  It’s vital that the early adopter users have a great experience.  And I’m not trying to pick on FourSquare or ShopKick.  I’m thrilled that companies like them are taking chances and moving the industry forward.  I don’t want to see either company end up as a “pioneer with arrows in their backs”, I want to see them both succeed and be well rewarded for being a first mover.  But I do think they need to rethink some of the customer experience corners they are cutting. 

Have the first generation experiences already hurt the publics perception?  Should ShopKick have iterated a bit more before firing up their PR efforts?  What has your experience been?