GUEST COMMENT Should retailers try to ‘catch ‘em all’?

Since its launch at the beginning of July, Pokémon Go has been drawing widespread attention from the mainstream media, business leaders, religious leaders and public health officials. The success of the launch can only be described as phenomenal!

For many, Pokémon Go brings back huge feelings of nostalgia, however it’s now caught up with modern technology and uses augmented reality to let players navigate a virtual world, based around the real world on Google Maps. It’s been estimated that the app was downloaded 15m times in its first week – and now stands beyond 100m.

Despite the huge success of Pokémon Go to date, Nintendo announced a profit loss for the period between April and June. In order to make the app a revenue-generator, it is expected that Pokémon Go will soon open up advertising to external brands. This development presents immense commercial opportunities for those brands lucky enough to find themselves within the augmented virtual world of Pokémon. Rumour has it that the fast-food giant McDonalds will be among the first brands preparing to sign up.

For all retailers, Pokémon Go presents a new and exciting opportunity to engage with consumers. The app is getting people off the sofa and hunting for Pokémon, meaning that people are going to be discovering new places. As retailers become aware that their sites are ‘Pokéstops’ or ‘Pokégyms’, they have begun to think of ways to capitalise on this opportunity. One such coffeeshop went to social media to alert its followers to its Pokéstop status, announcing the first ten Pokémon players would receive a free donut with any coffee purchase. Although a very basic idea, it shows how brands are already using the Pokémon movement to interact with and gain new customers.

Not only can Pokémon Go lead to increased footfall from potential new and existing customers, it can also provide an increase in brand awareness. Taking this one step further, brands will soon be able to sponsor locations on the augmented reality map, and begin communicating with consumers directly through the app.

But before retailers rush to allocate their advertising spend to Pokémon Go campaigns, it is important to err on the side of caution. Whilst the launch has been hugely successful, the real challenge will come when developers attempt to monetise the app. This process is going to involve a lot of testing and learning before it starts to generate significant revenues for brands, if indeed it ever does.

Once Pokémon Go’s sponsorship features kick in, there are brands which will no doubt rush in to take advantage of this game-changing moment. These brands will probably not receive a quick boost in sales as a result but of course, for many, this won’t matter. To be able to communicate with even a fraction of the number of users the game currently has is still a phenomenal opportunity.

With almost two-thirds of players in the 18-24 ‘millennial’ market, brands should embrace the opportunity this presents to target a market that typically tends to reject direct advertising. Again, brands should move forward with caution as this market is also quick to turn against brands who take an overly intrusive approach to their marketing. It is yet unknown whether these the younger die-hard fans will welcome advertising and marketing in their Pokémon world.

The sheer numbers involved will seduce some brands, but they need to properly thinking through why they’re choosing Pokémon Go. Without careful consideration, brands could waste significant portions of their marketing budgets without seeing much of a return on their investment. More than ever, it comes down to relevancy and understanding your own customers and their behaviours – what drives their attention and their spend. What’s right for a hip young fast-fashion brand won’t necessarily work for a luxury watch-maker, and vice versa.

Whether you love it or hate it, it is hard to discredit the huge success of the game. Pokémon Go has brought augmented reality gaming to the masses. As the first to market, it is going to pave the way for numerous more similar games, rumour has it developers have already started work on a Harry Potter game. For the retail industry, many will succeed but others run the risk of looking out-of-place, or even worse, out of touch with their customer base. The golden rule should be to think and plan carefully and not be mesmerised by the huge potential that Pokémon Go poses. There is clearly huge opportunities here but Pokémon Go is only the start of the augmented reality story, and brands should treat is as such when planning their digital marketing strategies.

Jens Nielsen is head of UK & Nordic operations & group management at NetBooster