We all know that retail and commerce is quickly moving online. That's no secret; that has been the trend for a while now. But what most out there seem to have forgotten is that the vast majority of shopping is still done in a brick and mortar store.
In recent years, there has been a trend toward using technology to help improve in-store sales, with companies designed to help store and advertisers inform customers of promotions and deals as they enter, or even pass by, the store.
One company that does this is Swirl, which uses micro-location technology to increase store traffic, shopper engagement and sales conversion. And now the company has raised $8 million in funding, it was announced on Tuesday.
The new money came from Hearst Ventures, with participation from SoftBank Capital, a unit of SoftBank Corp., and Longworth Venture Partners. Swirl had previously raised $6 million from SoftBank Capital, General Catalyst and Longworth Venture Partners, bringing its total funding to $14 million.
The funding will be used to expand Swirl's platform, taking it from specialty apparel and fashion retailers to big box and department stores.
Founded in 2012, Swirl's goal is to increase store traffic, shopping engagement, and sales conversion by pinpointing a shopper's exact location using beacons placed inside the store. The beacons then trigger content delivery when a shopper is in a specific location within the store.
Swirl also offers a mobile client SDK, which allows any retailer to add this in-store experience to their existing mobile app, as well as a set of cloud-based marketing tools that allow retailers to manage the content and offers that they deliver to shoppers.
This technology makes it so that the stores do not have to reply on GPS tracking, which, as Swirl notes, is not precise, doesn't always work indoors and can drain a person's battery.
"For a retailer, this could mean welcoming a loyal shopper back to the store by rewarding them with loyalty points when they walk through the store entrance or helping a shopper who is trying to make a purchase decision by delivering tips, product reviews and an offer while they browse in a specific area of the store," Rob Murphy, Swirl's VP of Marketing, explained to me.
Or it could mean that a big box retailer is able to send a set of tips and an offer to a shopper's smartphone while they browse in front of the latest line of flat screen TV's in the store.
The ultimate goal of the company is to "reinvent the in-store shopping experience with the help of mobile technologies."
"Consumers are using their mobile devices more than ever, including while they shop in stores, and we see a huge opportunity for retailers to create more value by connecting the digital and physical shopping experiences," said Murphy.
"For retailers, we want to bring the capabilities and sophistication of online marketing into the physical world. For consumers, we want their mobile device to function as a useful and valuable shopping companion whenever they shop in a retail store."
And Swirl is already proving that it can drive sales.
The Boston-based company launched a pilot program earlier this year with fashion retailers, including Alex and Ani, Kenneth Cole, and Timberland. It showed high consumer engagement and sales conversions, with a 75% in-store app open rate.
"Conversion rates and basket size for this campaign were significantly higher than the retailers' traditional marketing campaigns," said Murphy.
Right now, the company is already making plans for national rollouts with the retailers that participated in the summer pilot program.
The in-store sale space
Like I said before, most of the shopping is still done in-store, and so there have been a rash of companies using technology to help brick and mortar stores increase their sales. And many of them have been raising money.
For example, there is Shopular, a mobile app for iOS and Android that uses geo-location technology to alert people to nearby sales. Last month it raised $6.4 million in Series A financing from Sequoia Capital.
RetailMeNot uses geo-fencing to notify users of coupons and deals at nearby stores. The company has raised $300 million.
Retailigence, which sends an alert to a customer when a particular item is in stock and indicate where to find it, raised $6.3 million in Series B funding in March.
In February of this year, two companies with similar ambitions to Swirl also raised funds: Nom, a mobile first technology platform that provides brick and mortar retailers with the ability to gain greater insights by tracking consumer behavior across in-store and online channels, raised $3 million in seed funding, while Euclid, a service that gives storefronts insights into customer shopping habits, raised $17.3M million in Series B financing.
So what sets Swirl apart from these other companies?
For one, Swirl is a complete solution for retailers, with marketing tools, location sensors and sdk "to add the capabilities to their existing mobile apps," said Murphy.
In addition, the micro-location targeting allows for the delivery of "much more relevant content to shoppers in a specific area of the store rather than delivering generic messages."
And, for the retailers, there is the ease of set up. Swirl's beacons take minutes to install and don't require any external power or expensive wi-fi/network connections.
"There are lots of companies in the mobile-retail space, from mobile ad networks to mobile messaging platforms to retail traffic analytics companies, but none of them offers an end-to-end platform that provides everything that a retailer needs to create and manage large-scale in-store mobile marketing campaigns tailored to specific locations within a store," Murphy said.
(Image source: http://www.swirl.com)