About three and a half years ago, a company called Retale identified an opportunity: digitizing shopping coupons in weekly newspapers. Choosing to pursue this as a mobile app, it established a US headquarters right here in Chicago -- and has quietly amassed a staggering 26 million monthly active users globally.
Retale, which is part of Berlin-based advertising group Bonial, is a location-based mobile advertising platform that allows retailers and brands to showcase local and relevant deals to consumers directly within their physical proximity. And despite operating amidst a turbulent e-commerce landscape -- as Amazon's shadow looms over grocery stores and local merchants -- it firmly believes that most people still prefer the personal experience of buying items in-store -- with data and insight to corroborate.
"Most consumers today -- from the busy mom shopping for back-to-school supplies to the millennial college student -- are spending a lot of time on their mobile phones, including searching deals to help them save," said Retale's US Managing Director Nels Stromborg, in an interview with Chicago Inno. "Our insight has shown that after consuming media or ad content about a deal relevant to them, consumers overwhelmingly end up in stores within 24-48 hours."
To its retail partners, the company provides a modern, measurable user interface platform for what Stromborg says are the number one line item on budgets, costing nearly $8 billion per year: circulars and coupons. Available on both Google Play and the Apple Store, Retale's free app sends location-based triggers allowing consumers to browse over two hundred digital "shelves" of these circulars and coupons. Customers can clip and redeem coupons, link out to the product page, get store details and availability right away, and create a shopping list -- all within the app. Retale also collects data on shopper engagement and foot traffic analytics.
Stromborg says that Retale hasn't tried anything new or revolutionary for its user acquisition strategy, focusing on traditional social media channels, consumer-facing PR strategies, and organic downloads -- though it has found particular success in Facebook Messenger bots. It is also already investing significantly in trends like wearables (it has an Apple Watch application) and virtual reality.
Earlier this year, Retale also strategically acquired Out of Milk, the world's most widely used shopping app for Android, organically onboarding 11-12 million more users. "Out of Milk's searchable, structured data provides new opportunities for user engagement, but we are still figuring out how to best leverage this opportunity," he said.
Stromborg acknowledges the mobile app space is "very competitive, and scaling an audience is incredibly hard": But he also says the Out of Milk app sees it's most engaged users come back 30-40 times a month on the app. "Are you helping your customers solve a problem? Are you helping them be more efficient in their daily lives? If your value proposition is strong, you don't have to worry about going the app route or not," he says.
A Chicago native himself, Stromborg recognizes the immense value of having their U.S. operations based here: Retale is a rare B2C case study operating in a traditionally B2B stronghold. He points out Chicago's central location that gives them easy access to retailers and CPG companies, as well as the advantage of affordable cost of living and working. 18 employees are currently based here, a mix of sales, marketing, finance, account and content management. However, their development team works out of Berlin. "It's even more affordable [than Chicago], and their immigration situation retains much of the diverse global tech talent that ends up there," he said.
Retale recognizes the frictionless shopping experience that Amazon and other e-commerce stores provide, and is working to improve the personalization aspect of the app, making it more relatable to individual tastes and preferences.
"Of course Amazon is a big deal, and it's not slowing down anytime soon — but it's [recent] acquisition of Whole Foods proves that even they see potential in physical stores and retailers to innovate," he concluded.
Edit: This article has been updated to reflect that Out of Milk was acquired earlier this year, not last year; and that Out of Milk, not Retale, sees its most engaged users come back 30-40 times a month.
