Shopkick, the four year old mobile retail loyalty app that provides points for people coming into stores and virtual gift cards, has been sold to South Korean mobile services leader SK Planet for $200 million. SK Planet is expected to invest heavily in Shopkick’s international reach.

Once seen as a new mobile paradigm for shopping rewards and loyalty, Shopkick was especially notable in setting up collective “kicks” or points that could be used anywhere, encouraging regular usage. It realized earlier than most that consumers were less likely to download individual apps for retailers that they’d only use once or twice.

The company’s novelty has since worn off. Virtual check-ins are widely enabled by FourSquare and others as the technology has evolved from an exclusive reliance on smart phone alerts to also using wireless Beacon sensors, which are accurate to the point of capturing users within just a few feet — ideal for ID’ing shoppers near brands. Moreover, the value of virtual check ins have been called into question by newer card linked offer players that can match credit card information and more specific data (not to mention that many consumers collect points for just walking by a location and never going in).

Yet, ShopKick has developed a strong base of customers and continued to grow. The Redwood City, CA-based company, which has 75 employees, now has eight million active users and has kept its appeal to retailers eager to jump on location targeting and building loyalty programs. It now has 20 retailers and 200 brands under contract. Macy’s, for instance, has just signed on with a 4,000 Shopkick Beacon deal joining Target, BestBuy and other major chains working with the company.

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Here in San Francisco at BIA/Kelsey’s Mobile Local Media conference, a panel of three young companies offered a glimpse into the leading edge of mobile shopping and loyalty marketing.

Moderator Peter Krasilovsky walked each panelist through an examination of his business model, framing a conversation about the evolution of the hyper-competitive mobile payments and transaction marketing space.

Some common features include using loyalty points to drive behavior — store visits, meal purchases and so on — and a seamless experience, where no phone or coupon or loyalty card needs to be presented at the point of sale by consumers. For merchants, the incentives range from higher customer intake, more frequent in-store visits to higher average purchase value.

Josh Capilouto, director of sales operations at SCVNGR/LevelUp

LevelUp is an alternative payment system. The model is users download the app, link a credit card and pay at the point of sale using that card. The LevelUp business model is pay for performance via onboarding and loyalty campaigns. For example, a new customer might be offered two free dollars as an inducement to come into the store. If that money is spent, LevelUp gets a piece of that offer redemption. The same works with loyalty offers. If an offer is to spend $50 for a $5 credit, LevelUp gets a taste of that $5.

LevelUp is in 25 cities via the remove sales channel and is live with direct sales in eight cities, with three more expected by the end of summer or early fall.

Doug Galen, Chief Revenue Officer, Shopkick

Shopkick is a loyalty platform that works with partners to offer points of “kicks” to reward in-store visits. CRO Galen offered his view on the key trends driving mobile shopping.

He cited two key trends:

1. “There will be more change in retail in the next five years than there were in the last 100.”

2. “The mobile impact on shopping is happening faster than expected.”

Two minor supporting trends:

1. Retail is losing walk-ins and needs a solution to drive in-store traffic. Retailers want walk-ins and will pay for them. They have 25 percent to 50 percent conversion rates.

2. Consumers have too many loyalty cards — fragmentation hurts everyone.

Galen was asked about the restaurant chain Denny’s, which built own app. Why should a company work with Shopkick rather than build its own app? What did they miss out on? Galen said they missed 85 percent to 90 percent of their customer base. Most consumers will not use 40 different apps, Galen said. At best, 10 percent of a company’s most loyal users will.

Jon Carder, CEO, Mogl
The name dropper of the day was Mogl CEO Carder, who talked about a recent invitation to Richard Branson’s private island for dinner.

The Mogl model is to use game mechanics to build a network of restaurants, sign up consumer who synch a credit card, earning the chance to win cash back (10 percent for each visit), accumulate points that are redeemed as meals for charity or win a large jackpot.

Carder said the beauty is that different users are there for different reasons. Some people like to give to charity, others like cash, others like points.

One notable feature of Mogl is the cost to restaurants. The company charges restaurants 15 percent of sale. Carder said this isn’t a challenge. “As long as restaurants see ROI, they don’t care.”

he said the average restaurant pays $400 a month and experiences little attrition. “They will pay for value,” he said. “They are tired of cheap but valueless services.”

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American Eagle Outfitters becomes the latest partner to launch Shopkick nationwide, including its Aerie locations, starting today. The announcement comes on the heels of Target’s national rollout that we reported here. American Eagle Outfitters and Aerie shoppers will earn “kicks” or points just for walking in, and receive exclusive offers throughout the store.

American Eagle Outfitters was one of Shopkick’s first partners when the app launched in 2010. A year later, American Eagle Outfitters hosted the mobile app company’s first birthday party in its flagship store. For the past two years, the global retailer has conducted tests in pursuit of becoming an early adopter of technology to enhance the shopping experience. Among Shopkick users, American Eagle Outfitters found increased traffic (no exact numbers specified), sales, and higher purchase amounts.

As retail stores look for ways to leverage mobile technology, we expect to see similar partnerships with app companies providing mobile rewards. Speaking of partnerships, Shopkick also announced today the selection of Giftango to power its new digital card offering. The offering will allow retailers to access customer’s gift card information from within the app, eliminating the need for traditional gift cards that can get lost or stolen.

So much is happening right now in mobile commerce. To hear Shopkick CRO Doug Galen and learn more about the latest developments in the space, join us for MLM San Francisco.

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Target, one of the largest discount retailers in the U.S., announced today that it will now offer its guests the Shopkick app for their smartphones. When customers walk into their local Target store, they receive points known as “kicks.” As they shop, customers can also scan products for additional kicks. Kicks can be redeemed for Target gift cards, Facebook credits, dining gift certificates, iTunes downloads and charity donations to name a few.

In addition to Target, Shopkick also has a partnership with Old Navy. Earlier this year, the company announced that its app was available in more than 4,000 individual stores across multiple retailers. With smartphone penetration at nearly 50 percent, it’s a smart idea for retailers to adopt mobile tools to keep users engaged in-store. You can also engage with us in California for our MLM San Francisco conference. We’ll be talking about mobile commerce with Shopkick Chief Revenue Officer Doug Galen.

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