The Digital Marketing Lesson Of 'Pokémon GO'

This article originally appeared on Forbes.com.

By now, you’ve probably heard of the mobile gaming phenomenon that is Pokémon GO. Perhaps you’re even among the tens of millions of people who downloaded it at a record-breaking pace, making it the biggest mobile game in U.S. history.

The app taps the geo-positioning and camera functions of your smartphone, and encourages you to walk around your city looking to catch virtual Pokémon—short for “pocket monsters”—that pop up in seemingly random places. But their locations are hardly random: The game’s developers looked at years of Google Maps and other location data to find interesting and intuitive places to harbor Pokémon. And, not surprisingly, there are sponsored locations as well.

Companies and marketers around the world are already working hard to tap into the game’s runaway success, which has demonstrated the unique ability to drive real-world foot traffic. In Japan, birthplace of the Pokémon franchise, McDonald’s became the game’s first big sponsor, converting each of its nearly 3,000 Japanese locations into PokéStops, real-world spots where users can load up on items to play the game, or Pokémon Gyms, where users can fight virtual battles with each other and gain strength in the game.

However, you don’t have to be a Fortune 500 firm or fast-food empire to use augmented-reality games and other apps to bridge the gap between consumers’ digital behavior and your brick-and-mortar business. As with Foursquare and Facebook, small businesses can pay to advertise or reward visitors who use Pokémon GO. One pizza shop owner in New York paid a modest $10 through the app to temporarily draw a dozen of the imaginary characters into his restaurant, and saw business leap by 75% as players came in to “catch ‘em all.”

This mingling of the digital and physical worlds is at the heart of what we at Bain call the Digical experience. Whether it’s an Internet-enabled thermostat that adds a new dimension to home life, or Disney’s MyMagic+ system that heightens your enjoyment at a Disney theme park, leading companies are using a combination of math and marketing magic to dazzle their customers, which my colleagues and I wrote about in April.

Good marketers know how to mine data to see what annoys their customers—and what delights them. They use that digital information to continually improve a customer’s real-world experience when interacting with their brand—or vice versa, perhaps guiding their online shopping based on their last in-store visit.

But the best marketers understand the importance of “magic”—those intangible qualities that tug on consumers’ emotions and make a product more alluring. The magic of Pokémon GO is especially ingenious. Niantic Labs, which teamed up with Pokémon Co. to develop Pokémon GO, launched a similar augmented-reality game nearly four years ago called Ingress that never went beyond the realm of niche gaming. Pokémon GO, on the other hand, played on consumers’ nostalgia for the games, playing cards and toys from the 1990s.

A truly magical opportunity, coupled with the skillful use of algorithms and data, give rise to Digical experiences that stick with customers. The most successful companies use these Digical experiences to build a bond with customers, who feel like the company knows them and wants to help them. What’s more, this constant data flow between the digital and offline worlds can help a company adapt quickly to a customer’s changing preferences in both settings. Picture a grocery store app that allows customers to choose recipes on their phones and then plots a route through their local store to help them find all the ingredients.

The truth is, while certain industries are better positioned to prosper from this collision of the virtual and real worlds, every corner of 21st century commerce involves some combination of the digital and physical factors. For marketers who can master this balance, the result is a kind of digital magic that allows companies of all stripes to not just personalize and perfect customers’ experiences, but to practice the relentless cycle of testing, learning and adapting that has helped so many technology companies find success.

Laura Beaudin is a partner in Bain & Company’s Customer Strategy & Marketing practice, leading the practice’s Marketing Excellence work.