Pokemon Go Lures Customers to Small Businesses

Learn how Pokemon Go can help increase customers and boost sales to your small business.

In July 2016, Pokemon Go, an augmented reality game, launched in over thirty countries. It first became available in the U.S., New Zealand and Australia on July 6, and most recently, in Japan on July 21. The game takes advantage of the nostalgia surrounding a popular Japanese franchise that was released two decades ago as a card game, video game and cartoon show. The concept involves people travelling the world collecting animals known as Pokemon that each have their unique powers and appearances.

Pokemon Go uses GPS and camera features on phones to allow fans to become Pokemon trainers by walking around their neighborhoods, exploring parks and even entering small businesses in the hopes of virtually catching Pokemon by throwing Pokeballs at them. Once players collect a certain number of Pokemon and progress in the game, players will gain levels and get access to even more game items. In addition to catching Pokemon, users can collect Pokeballs and other items at locations known as Pokestops. Players can also battle other Pokemon trainers at locations known as Gyms.

Downloading the game is free, but users can also make purchases within the app if they want to buy more items or features. A feature known as a lure can be dropped on Pokestops for 30 minutes, which attracts nearby Pokemon to appear by the location. Millions of smartphone users have joined in on the fun, making headlines with outrageous stories about accidents and discoveries and even driving foot traffic to small businesses. Since the release of the game, Nintendo’s stock price has doubled.

Areas with lures, Pokestops and Gyms have been gathering attention as people have crowded around them in their quest to capture rare or interesting Pokemon. Small businesses located near these virtual landmarks have benefitted from the craze. Most lures cost under a dollar, and some businesses have purchased Lure Modules for $10, which can be purchased by credit card, to attract Pokemon for the whole day. Many small businesses have profited from lures driving foot traffic to their doors, particularly restaurants, coffee shops, pizzerias and cafes where customers can spend time at the location getting drinks or meals while simultaneously playing the game. Some small businesses have taken advantage of the Pokemon phenomenon in other ways, using the popularity to advertise special Pokemon-affiliated promotions and products. Others have provided discounts to members on certain Pokemon teams.

There has also been criticism about Pokemon Go. Some small business owners have expressed dissatisfaction as the game drives people to come to their doors without intentions of entering and making purchases, which can create a nuisance for actual customers. Other players have complained about technological glitches, while organizations have argued that the game leads players to inappropriate locations. These prospects leave people wondering if the Pokemon Go craze will last. Is the phenomenon temporary, or does it have the potential to have a long-lasting impact on small businesses?

Niantic, the developer of Pokemon Go, has announced that exciting new features will soon come to the game. Small businesses will be able to take advantage of location-based advertising and enter partnerships with the gaming company to become sponsored locations that attract Pokemon and therefore, potential customers.

Historically, small businesses owners have faced their fair share of troubles. Not only do they have tough competition from big brand names, but they also face challenges in getting funding, such as taking out a loan from a bank. This recent surge of Pokemon Go popularity may help small businesses boost their sales and develop useful marketing strategies. With the promise of more available features and expansions to more countries on the horizon, both Pokemon fans and small businesses alike may benefit from the possibilities.

Justin Song

Justin is a Sr. Research Analyst at ValuePenguin, focusing on small business lending. He was a corporate strategy associate at IBM.

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