Proximity parking app drives retail sales
Through a special arrangement, what follows is an excerpt of an article from FierceRetail, an e-newsletter and website covering the latest retail technology news and analysis.
Retailers are finding yet another critical use for beacons: parking.
Shoppers who park and receive messages on their smartphones from businesses nearby are 30 percent more likely to visit that location, according to HotSpot, a Canadian mobile parking payment solution and proximity marketing company.
HotSpot partnered with beacon provider Kontakti.io in parking lots to contact shoppers and then track behavior at nearby retail locations. The application lets shoppers monitor and pay for parking remotely, eliminating the uncertainty and risk of tickets and fines. And ultimately, the parking innovation allows consumers to shop more freely.
For their part, merchants, who pay a subscription fee for the service, have the option to cover parking fees to encourage shoppers to visit or stay longer.
Much of the discussion and promise of proximity technology has centered around the in-store or in-mall experience. But by addressing another pain point — parking — merchants can create a better shopping experience in different ways.
Source: Kontakt.io whitepaper
"HotSpot Parking is a pretty complicated business idea: serving a central coordinator between the needs of three different and powerful groups of people, they thrive because they exist to solve a complicated problem well, and because they don’t have to worry about the software or hardware side of their proximity business thanks to Kontakt.io," noted a HotSpot whitepaper. "Balancing the needs of the city, the retailers and their customers, they launched initially with some simple goals, overcame some challenging hurdles, and have grown to be the largest application of their kind in Canada."
HotSpot now incorporates roughly 30 percent of the parking facilities in four Canadian cities with 500 beacons deployed. On average, users spend 61 minutes in the store, which is seven minutes, or 13 percent longer, than the average time spent in brick-and-mortar stores, according to ICSC/Shopping Centers Today.
HotSpot recently partnered with Passport Parking of North Carolina to expand in the U.S.
- Proximity parking app drives retail sales – FierceRetail
- Drive Visits with Parking: – HotSpot
- HotSpot Parking makes move into U.S. market – CBC News
What do you think of a shopping beacon linked to parking? Do you see covering parking fees as a strong incentive to encourage consumers to use beacons and shop?
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13 Comments on "Proximity parking app drives retail sales"
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I somehow think this logic is backwards.
We have two parking apps in Miami (one for Miami Beach, one for the city of Miami), and I love them. Truly a win-win for everyone. No coins to collect or machines to fix for the city, no coins to stash or impossible-to-use machines for me.
But I’m parking BECAUSE I’m going somewhere. I’m not going to decide to go somewhere because I’ve parked. So why would a retailer want to incent something that’s already going to happen? And why would one think I’d change my mind and go somewhere else?
This is one of the core problems with the way our industry runs promotions today. We seem to have an inability to accurately calculate costs like pantry packing, or giving an offer on an item that was already going to be bought.
This is the problem retailers must solve. Then I’d be more comfortable talking about tactics.
This is a big hit in urban areas — at least in Chicago. The parking apps that locate and let you reserve available garage or lot spaces are all the rage. Adding the convenience of nearby parking (not to mention potentially “validating” a la restaurants or movie theaters) is a winner for the city folk for sure.
Some consumers might visit a store to have the cost of their parking covered, but many will not accept a barrage of ads pouring out of their smartphones. And how will this work for on-street parking?
Another innovation from Oh Canada! I’m so proud. Frankly this is about the only one of these mobile shopping apps that makes sense.
This is definitely a great incentive for consumers and retailers. I can also see CPG brands getting more into the game, partnering with retailers. These offers can target shoppers to extend their stay in the mall, even if they didn’t plan on shopping those promoted stores. Maybe. We’ll see.
Seems like a pretty slim app to me. Not sure if there is a valid statistic, but I am betting that over 90 percent of retailers have free parking for their customers. Sure there are some areas where you have to pay for parking, or pay at a meter, but I am betting that is in the minority when you consider all retail.
If it helped you find an open space instead of circling for one that might be useful, but I doubt it can do that. Lastly, how many specialized apps do we really think shoppers will keep on their phones?
Two of the biggest challenges retail stores face today are 1) trips, getting customers to stores, and 2) stickiness, getting them to stay and shop.
This is one of the most creative uses of beacon technology to help take the pain out of parking and get consumers shopping.
Just because they come and stay longer doesn’t guarantee they will buy — retailers still must attend to in-store consumer experience.
Neat idea with legs.
This is not something that excites me. I do not want to get to a parking lot and get blitzed with messages. I have enough of a problem with them already. Why am I going to go somewhere else to get my parking paid if I am already parking there because of the convenience of the store I was there to visit in the first place?
I’m wondering how they’re addressing CASL with this. It would be illegal to send a commercial electronic message to anyone who didn’t consent to it beforehand.
Love the hotspot parking concept. For the retailer, offering a perk to a good customer can pay off. If you can make it easier for a customer to do business for you, do it. Furthermore, if a customer loves to do business with you and gives you permission to market to them through their mobile device, and you treat that relationship and permission with the love and respect it deserves, then your customers will appreciate hearing from you.
Seems like a smart strategy, definitely worth exploring. As retailers look for ways to make location awareness more relevant and less creepy, this feels perfectly motivated and natural: “Since you’re parking nearby, why not come visit our store? And by the way, we’ll pick up the parking tab if you shop with us.” Smart.
What HotSpot doing is unimpressive—they are merely topping off parking meters for customers which is what “validate parking” does very well. In addition, only late generation Apple devices properly support beacon technology, not Android or Windows.
However, the concept of replacing flyers under car windshields in parking lots with offers of discounts from local retailer at the parking point-of-sale is exciting and a new untapped win-win opportunity for local merchants and the parking operator.