In what has been one of the major breakthroughs in location based shopping space, SK Telecom announced recently that it will acquire Shopkick Inc.
SK Telecom is a wireless telecommunications service provider in South Korea. We believe this move is the company’s effort to capture a significant share of fast growing Location based shopping and Proximity market in US. Shopkick is the most widely used real-world shopping app in the US. As per the deal, Shopkick will continue under the leadership of its current team. SK planet was advised by Pagemill Partners and Weil, Gotshal & Manges LLP while Shopkick was advised by Fenwick & West LLP for the deal. Terms of the deal have not been disclosed.
SK Telecom is Korea’s largest mobile carrier. Its affiliate company, SK Holdings operates Korea’s most popular mobile platform and reward program that processes over $ 50 Bn transaction every year. In an announcement last year, it had stated that it would spend up-to $1 billion through its SK Planet Internet services arm to buy, invest in and build U.S. companies over the next three to five years.
The acquisition will not only create a platform for SK Telecom to launch in the US mobile commerce business, but will also help it expand its global market position. Together with Shopkick, the company plans to build a robust ecosystem for seamless mobile, online and offline shopping experiences across globe. Shopkick is the pioneer firm in proximity shopping space. It gives users points, or kicks, for entering a store while using its app. The app has more than eight million users. The World Economic Forum (WEF) named shopkick a Technology Pioneer 2013. Forbes rated shopkick as one of America's 100 Most Promising Companies in 2014.
In a nutshell, Shopkick will add business assets to accelerate the growth of SK Telecom among retailers and shoppers alike.
"Our vision is to build the most beautiful and useful digital user interface on top of the physical shopping world," said Cyriac Roeding, CEO and co-founder of shopkick. He said that his company’s strategy was closely aligned with that of Shopkick. The company needed infusion of resources to keep up with the increasing demand and growth across segments. The deal serves all these purposes, and more.
According to an estimate by Forrester Research, the offline shopping market that is influenced by online activities is as high as $ 1.4 Trillion in US! This is at least 4-5 times larger than the total online shopping market. SK Telecom will try to lead the market into shopping experience that facilitates “online to offline” commerce.