Disruptive marketing in action: The Pokémon Go effect
The record-breaking release of augmented reality game Pokemon Go is already showing signs of influencing businesses of all sizes, with many quickly catching on to the hype of the addictive hunting game and using it to their advantage.
Small businesses in particular are benefiting from the craze, with many using in-app purchases known as ‘Lure Modules’ in order to attract Pokemon, with those looking to catch them following suit. Examples of such creative marketing strategies include L’inizio’s Pizza Bar in New York. Spending approximately $10 on Lure Modules for a day resulted in a 75 per cent rise in business sales. This is a prime example of the power and influence of the app.
Some locations are automatically designated as 'Pokestops' or 'Gyms', where players can fight one another or stock up on goods. These are crucial to the game, meaning footfall in these areas increases over time. Therefore, while not appropriate for every business, it’s worth using such a feature to your advantage.
Eva Marsh is an intern at ifour.
Many companies are using this opportunity to drive sales by conducting Pokemon-related competitions, such as Port City Brewing Company in Washington, which was discovered to be a Gym. A two-day long Pokemon Costume Contest was then organised at the brewery with prizes being given out for those who took part. This was advertised on its Twitter account, meaning that anyone could take part, even those who were unaware of the brewery beforehand.
The Pokemon phenomenon could also be a lure to areas that are regenerating or looking to drive additional foot traffic in town centres and areas affected by out of town developments.
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ifour decided to put this theory to the test with a quick straw poll in The Pantiles, an area of Kent that is seeing a resurgence following some exciting new shops, as well as the old favourites. The interns were sent out to quiz those clutching a phone.
Out of 16 people, 11 were playing Pokemon Go at that moment, six players stated they would go to an area with lots of Pokestops, while seven players said they would choose a coffee, pub or other business if they had a dedicated Pokéstop.
To put this into context for non-gamers, The Pantiles has nine Pokéstops in close proximity so the sight of a player holding their phone up at an odd angle is already quite normal. Even in this small sample size the prevalence of Pokemon Go is clear, with the majority of people asked playing the game. It’s also likely that gamers would seek out specific places because of their Pokemon benefits, so perhaps more businesses need to be getting involved.
However, Pokemon Go won’t be a good thing for everyone. Its release and growing popularity among small businesses as a marketing tool, may hit companies such as Foursquare who run the app Swarm, which allows users to earn prizes and even money off vouchers when they ‘check in’ to participating venues. Business owners may choose to redirect their spending to Pokemon Go over Swarm as it has more users.
Pokemon Go could also have benefits for major brand retailers, who are thought to be looking into getting involved with the phenomenon. John Hanke, the chief of Niantic, the software developers behind the app, has stated that sponsored locations will be introduced, creating a new source of revenue for the already hugely successful game.
The first sponsorship is rumoured to be introduced alongside the release of Pokemon Go in Japan, Pokemon's country of origin. TechCrunch reports that the first collaboration will be with McDonald's, with their fast- food restaurants becoming Gyms although there is no specified date for when the release will be taking place.
However, Pokemon Go is already having a huge impact on McDonald’s Japan, which has been struggling due to food safety scandals. Their stock soared by as much as 23 per cent when Pokemon figurines, such as the popular Pikachu, were included in Happy Meals, demonstrating that consumers are flocking to anything Pokemon Go. With the game not even launched yet, it's safe to say we haven’t seen the full effect of Pokemon Go in Japan.
As the game becomes more popular and users spend longer on it, an increasing trend is appearing. High-level players who have dedicated the last two weeks to playing on the app have started to sell their accounts on eBay - for a very high price. An individual claiming to be the game's Number One in the world has uploaded their Pokemon account onto the selling site, with the 'buy it now' price set at $8,888.88. It seems even players are realising the potential for money to be made because of the trendy app.
Eva Marsh is an intern at ifour
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