Boston-based in-store beacon company Swirl revealed its $18 million Series C round on Thursday.
Led by Twitter Ventures, Hearst Ventures and SoftBank Capital, with participation from Longworth Venture Partners, this latest capital injection brings Swirl’s total funding to $32 million.
It’s evidence that beacon technology is reaching maturity, said Hilmi Ozguc, CEO and founder of Swirl, whose clients include Marriott, Urban Outfitters, Lord & Taylor, Alex and Ani, Hudson’s Bay and Timberland.
“We have the attention of big players who are making a bet on this space,” said Ozguc, who alluded to potential partnerships that could increase Swirl’s scale.
“Publishers, especially a mobile publisher with a well-distributed app like Twitter, or many of Hearst’s properties, bring audience reach,” he said. “And that’s important for retailers, even very large ones like Target, for example, that have perhaps 10 million people who’ve downloaded their app.
"Those are very loyal shoppers, but it’s still only a very small percentage of the total number of people who go to a Target store every day or every week. How do you reach everyone who comes to your store? The only way to do it is to tap into the audience that big mobile app publishers can bring.”
Having spent the last couple of years, and $15 million, focused on building its technology, the bulk of Swirl’s new cash will go to sales and marketing, although a large portion is also earmarked for product development. Swirl plans to either double or triple the size of its existing 30-person team by next year with new hires in sales, marketing and engineering.
“We get feedback from our retailer and brand clients all the time about new features and functionalities they want,” Ozguc said. “We have a big backlog of requests around technology we want to accelerate and bring to market.”
Among those requests is the ability to integrate with payment systems and CRM systems, as well as nascent interest in wearables. Clients have also been asking for more online to offline retargeting capabilities that would allow them to target consumers in-store based on what items they might have previously put in an online shopping cart or on a wish list.
“But one thing we don’t want to happen is to have this whole thing turn into random spam – no one wants to see an ad for toothpaste when they’re in a Best Buy,” Ozguc said, who noted that Swirl’s tech has built-in frequency capping features to cut down on overmessaging.
Although Swirl doesn’t offer RTB bidding, Ozguc said the time is right.
“Think about a grocery store where there might be five different shampoo brands that all want to communicate with the consumer – that’s a great setup from an RTB environment and you’ll see that coming from us soon,” he said. “It’s also a way to make sure this doesn’t become overwhelming or spammy for the consumer.”
Ozguc said the company’s been seeing good activity on SWx, Swirl’s programmatic ad exchange for proximity-based in-store mobile marketing.
Estée Lauder and Michael Kors ran in-aisle campaigns in Lord & Taylor stores across the country during the past holiday shopping season. In both cases, the brands would send users who showed intent – signaled by their spending more than a minimum set amount of time in either the beauty department or the handbag department – push notifications to learn more about certain products on display.
Marriott uses Swirl to target people while they’re in specific places around the hotel. Guests lounging by the pool for more than 15 minutes, for example, might find themselves pinged with a message that says, “How about a free appetizer with your next drink order?”
According to Ozguc, brands see about a 30% increase in conversion rate when they send out targeted messages through the network.
“If you know exactly where a user is, if they’ve been there before and if they have an increased interest level, then you don’t need to know their name or their age or their gender,” Ozguc said. “It’s all based on in-store behavior.”