Shopkick is an offshoot of the Foursquare concept, but with several important improvements that may someday supersede the Foursquare model. So far, shopkick has already won the participation of several nationwide retailers like Best Buy and Target.

Let’s first go over what it shares with Foursquare. It is a smart phone application that involves checking in at various participating stores/restaurants. Those who do are rewarded with specials, promotions and gift certificates. Like Foursquare, one can send friend invites and connect up through Facebook. Additionally, users of shopkick can accumulate kickbucks, which can lead to rewards like gift certificates and prizes.

But the difference is in the details. Rather than trusting customers to accurately check in while they are at the location they claim to be, shopkick has a piece of hardware in the store that ensures the customer is actually there.  Secondly, it can remind customers to check-in and receive notifications about promotions and deals. Therefore, external incentives are not the only motivator for customers to participate. It allows customers to see only the relevant promotions and avoid the deluge of things they just aren’t interested in.

Up to this point, shopkick has been primarily applied in retail environments. Nonetheless, there is no reason it cannot work for restaurants, so we expect it to eventually involve restaurants. And if shopkick cannot match the needs of individual restaurants, then certainly another startup will come along with a similar model.

However, if there is one area of concern with shopkick, it is consumer privacy. The retailer/restaurant learns a lot about their customers buying habits. But then again so does Amazon. And it isn’t exactly a bad thing if identities are not actually disclosed. Shopkick, like Facebook, can amend their system to address this issue, and maintain an open format to control any reasonable fears.

Most importantly, with shopkick, the power shifts to the restaurant as abuse is much harder and a waste of time. By notifying customers, it engages those with the application in a way that Foursquare and its cousins can only dream of. With hardware specific to the restaurant, this concept will eventually be personalized to the customer’s behavior, managing promotions and rewards. Our hope is that restaurants  through technologies like these gain greater control over geo-location.