PokemonGo, the recent sensation among teenagers and adults alike, is a free-to-play location based augmented reality(AR) mobile game developed by Niantic, available on iOS and Android devices. The game primarily uses the GPS and camera of the user’s phone, which augments the user’s reality and surroundings into the game.
It virtually places the (user) in the present location(GPS) on map; all the while mirroring the google maps with roads and locales on the user’s phone.
The character in the game moves whenever the gamer/user moves (tracking the phone’s GPS) in the real world.
Different Pokemon species reside in different areas of the world, for eg: water type Pokemons are generally found near water bodies in the real world, generating a rather authentic touch and a more interactive feeling in real time amidst users.
When a player encounters a Pokemon, they may view it either in augmented reality (AR) mode or with a live rendered, generic background (using the phone’s camera).
AR mode uses the camera and gyroscope on the player’s mobile device to display an image of a Pokemon as though it were right there in the real world. Players can take screen shots of the Pokemon they encounter either with or without the AR mode activated. The ultimate goal of the game is to complete all the entries in the Pokedex, a rather comprehensive Pokemon encyclopedia, by capturing and evolving to obtain all the original 151 Pokemons, mentioned in the series.
A Gym is a battling arena where users train their Pokemon during battles. For the moment these are the only spaces to train the Pokemon. However, a user can only access the gym when he/she reaches level 5 or above in the game.
PokemonGo is better than the other games, since it involves physical activity by the user. To get to the Pokemon, Pokestop or a Gym the user needs to actually travel.
Another interesting feature is that the gamer has to travel mandatorily travel a distance(2,5 or 10 kms) in real world to be able to use the game’s bonuses such as Eggs for powerup’s, etc.
It has been suggested that Pokemon Go can potentially improve the mental and physical health of players suffering from depression and social anxiety. According to Kashmira Gander of The Independent, the social nature of the game provides easy avenues for those with social anxiety to interact with people of all backgrounds. Dr. John Grohol, founder of Psych Central, stated that Pokemon Go was unique in the magnitude of people “expressing the benefits of playing video games to their real-world mental health status”.
The game was released in Australia, New Zealand and U.S.A. in 1st week of July 2016. Till date 33 more countries have been added to where the game is used. With an official release in Japan happening just a few days ago, other Asian countries can soon expect an official launch.
The Chinese have cloned this game and developed “City Spirit Go” on the same lines, although certain avid gamers bought Australian App store IDs and used a GPS spoofing app to confound and use Google services, however to their dismay there was no Pokemon available to be caught in China.
Businesses have benefited from the nearby presence of Poke-stops (or their being the Poke-stops themselves). On July 15, Yelp added a filter that only shows businesses which have a Poke-Stop nearby. National parks across the United States saw an influx of visitors due to the game, with “hundreds or thousands” of people visiting the National Mall and Memorial Parks in Washington, D.C. on the weekend following Pokemon Go’s release in the country. Small museums with Poke-Stops placed at exhibits also reported increased attendance, such as the McNay Art Museum in San Antonio, Texas, and the Morikami Museum and Japanese Gardens in Boca Raton, Florida.
Nintendo’s turnover sales crossed a record breaking 6.6 billion US$ and trading stocks accounted for almost a quarter of the value of shares traded at Tokyo stock exchange within 20days of the game release.
How can Hoteliers monetize the Pokemon Go ?
- Driving the traffic :
Pokemon Go successfully drives the 2 of the 4P’s of Marketing principle, i.e. : Place and Promotion.
The augmented reality dynamics of the game is such that it induces gamers to move and find places where they could capture their potential Pokemon, reach Poke-stops(to get the game’s bonus such as coins,eggs,etc), Gym(to battle Pokemons). These places could be facilities such as restaurants, amusement parks, bars, hotels, concerts, events fairs and symposiums. This would cater to promoting a place in the quickest possible manner.
- Build an ecosystem supporting PokemonGo
The hospitality industry aggregators could go a step further to reach out to these millennials target market by declaring their facilities as Pokemon friendly. The game requires high speed WIFI and is heavy on the gaming device(phone) battery. A facility that hosting phone charging stations and WIFI would be an attraction for gamers. While the game would get footfalls to the facility, the gamers can use the facility’s services such as food and beverage, etc. This would somewhat similar to a Casino’s concept where the players are provided with Wine and Dine, whilst they play at the tables. Here the players can play their game on their respective devices, whilst can pay and use the facility’s amenities and services (food and beverage, paid utilities).
- Strategic Alliances with Nintendo
In the present model players’/facility owners can pay up and select “LURE” to attract the Pokemons to a specific location. Each LURE is active for 30 mins and costs about 0.60$.
This area could be a facility in the hospitality enterprise.
Going further it is projected that Nintendo shall open its doors for purchase of Poke Stops and Gym’s, which would be a boon for facility owners : hotels, restaurants, fairs, event spaces,etc.
An American Pizzeria reported a spike of staggering 75% to their sales during a weekend after using 10$ to buy LURE modules.
McDonalds Japan has tied up with Nintendo to host Poke-Stops and Gyms at their 10,000 restaurants, post this news McDonald Japan’s share price saw an increase by 9.8%
- Targeting new segment, Social Presence, Encouraging social share
PokemonGo brings a new creed of potential market to the facilities such as millennials, children, teenagers.
Gamers are using TripAdvisor to acknowledge the ease of finding a Pokemon at a property (Hotel). A traveler rated a hotel Villa Royale in Paris highly on TripAdvisor where he talks about the hotel’s great facilities and surroundings along with the Pokemons found in the hotel. The hotel general manager replies back acknowledging this and further goes on to mention that travelers could find greater number of Pokemons during breakfast in the breakfast room(increased footfalls during the breakfast period).
TripAdvisor has gone a step ahead and listed different properties by search filter of type of Pokemon likely being found there ,which is usually in-sync with the property’s surroundings of its flora and fauna!
Mantra is an Australian hotel chain, with over 20,000 keys to its portfolio. It has been one of the first hotel chains to monetize the PokemonGo craze by launching the world’s first Pokemon Go friendly hotels. It works on the LURE module and is also a PokeStop.
Gamers can PokeStop by Mantra 2 Bond Street in Sydney from 3 pm every Friday during July to receive a free bowl of fries with any drink purchase, and Melbournian Pokemon Go catchers can also cash in on happy hour drinks at Mantra on Little Bourke from 3 pm every Friday during July.
The hotel chain markets itself by showing potential areas in a hotel room or restaurants, etc where in a gamer could run into a Pokemon!
This has been tweeted and posted on social media by many excited travelers and hoteliers
Country Inn & Suites, Portland Airport has made itself a GYM on the app, meaning Pokemon Go players can capture the digital creatures throughout the hotel, fight GYM leaders and then run the GYM site.
The hotel is offering a 10 percent discount when rooms are available to gamers.
PokemonGo is clearly a crowd puller and can get ample footfalls to a facility or an event. Restaurants, Hotels, Bars, Shopping Malls, Fairs, Amusement Parks, etc. can use it as a part of their marketing strategy at a fraction of cost.
However, the kind of crowd pulled may or may not be their apt target audience. Facilities like restaurants, hotels,etc would have to put in entry barriers such as cover charge or a minimal spend to access area in the facility which would be a PokeStop or a Gym.
Industry experts claim, that an average hotel would spend about 1/6th of their Overall Revenue on Marketing activities.
With the help of PokemonGo hoteliers can increase their profits by a minimum of 3.5% annually, by saving around 33% on their annual marketing spend.
Hotels market their properties and its facilities in various forms such as Billboards, Written and Printed Material, Advertisements (Print, Videos and Voice), Events and Fairs, Online Marketing (Ads, SEO, SEM, Inbound marketing, etc.).
Organizing an Event and Fairs, sending out invites and following up on the invitees is an arduous task which requires a considerable spend of manpower and money.
Of the channels used for marketing, Online Marketing and Events account for almost 60-65% of the marketing spend.
Taking an example of a 200 rooms city hotel having 2 onsite restaurants: Coffee Shop and a specialty restaurant. Typically, Rooms shall account for 65% of Revenue, Coffee Shop 15%, Specialty Restaurant 10% and Miscellaneous Revenue 10% of the Gross Turnover.
Considering the hotel achieves an annual occupancy of 70% and an average ARR of 100 US $, the hotel will achieve a gross annual turnover $ 7.86 million.
The marketing spend of such hotel would be about 3% of the turnover, $ 2,35,846.
70% of the Marketing spend is traditionally utilized for online marketing and events; $ 1,65,092 annually,$ 41,273 quarterly.
About, One-third of this spend goes in Local areas marketing spend.
LURE module in PokemonGo costs about 0.60$ for 30 mins, considering LURE is used 3 times a day for 1 hour each(during restaurant/bar or any other point of sale’s promotion hours),
It shall cost $ 9720 quarterly, this would have a minimal saving of at-least 10% in the marketing spend per quarter versus spend on usual marketing techniques for areas in vicinity. This would eventually extrapolate to 33% annual savings on the local marketing spend and would increase profits by about 3.5% (about US$ 55,030) annually!
Apart from LURE module, hoteliers can have a liaison with Nintendo for hosting Pokemon Gyms (gamers congregate in large numbers at these spots for battling with each others’ Pokemon’s) at their facilities, McDonald’s Japan has signed up for 10,000 of its restaurants in Japan for this.
Hoteliers should make apt use of this new trend to be there to capture the market first as a nouveau player which could be a differentiator for them not only for saving costs also for brand recognition. Mantra Hotels in Australia brand themselves as PokemonGo friendly hotels. There have been reviewers who have posted about finding their favourite Pokemon’s in a hotel property. Hotels can promote their sites by providing the facilities such as charging stations, WIFI for the gamers; whilst the gamers use the hotel’s facilities at a surcharge.
There have been recent reports of accidents in real world due to negligence by gamers while playing this game, hazards associated with the game are similar to using a mobile device while driving or moving around. These can easily be addressed with gamer’s attention and cognitive ability to translate between the real and VR world.
Some interesting stats about PokemonGo
- It has about 26 million active users in U.S. which makes it 5.92% of the android users in U.S.
- An average user spends about 43 mins daily on this game
- Revenue generated by the game till date(19/7/16) : $35 million
- PokemonGo has the highest number of downloads from iOS app store as compared to any other app
- Nintendo’s market value increased by $9 million within 5 days of the game release
- 7 out of 10 people that download the app return to it the next day
- PokemonGo’s daily usage is twice as much on Android apps than the Facebook app