Category Archives: Coupons/Promotions

Signpost: CRM, Marketing Automation Enhance Promotions

Signpost_Logo (3)

Deals and coupons remain anchors for local business promotion. But they can now be customized based on customer behavior and better marketing automation tools.
Signpost is eager to leverage these developments. While the 200 person company launched in 2011 as a “Deals Scout” and promotions manager – initially supporting Google Offers and others — it has increasingly gotten into software development.

Today, the company – which has raised about $15 million from Spark Capital, Google Ventures, OpenView Venture Partners and others — announced a new strategy that measures SMB interactions with customers (calls, email and credit card transactions). That data is then used it to drive a number of automated marketing solutions (coupons, reviews, referrals). It can also be used to generate real time reports on spending behavior, and rank customers by transaction activity, transaction size and recent interactions.

Pricing for the service is set for $199 a month, which represents a $50 increase from the earlier, promotions-oriented effort.

The question for Signpost is whether it can effectively carve out a niche for itself. Other companies, ranging from Marketo and HubSpot to Groupon, First Data and ForwardLine, are also delivering a wider range of SMB targeting services based on customer behavior they are tracking.

Signpost CEO Stu Wall is a featured speaker at Leading in Local: SMB Digital Marketing, which takes place Sept. 22-24 in New Orleans. You can get more information here.


Signpost CEO Stu Wall

Empty Seats at Lunch? Mogl Launches Time of Day Promotions

Loyalty programs offering cash back or other rewards make a lot of sense for merchants – until it is 7:30 pm on Friday, and the loyalty program is still giving 20 percent back even though it is prime time for the restaurant. Mogl, the San Diego-based loyalty firm now working with over 1,000 restaurants in Southern California, San Francisco and Phoenix, thinks it has solved the problem.

Since June, the company — which has raised $25 million and set to initiate a new round — has been rolling out a new version that lets restaurants choose the amount of cash-back based on time of day. A 20 percent promotion at lunch can shrink to 1 percent for dinner, and go back to 10 percent for brunch – based on when the restaurant has seats to fill. Mogl calls this putting “butts in seats”.

How does it work? Restaurants log on to their dashboard on the Mogl website to program their cash-back offer by day and time. Mogl has established direct relationships with Visa, MasterCard and American Express providing users with a seamless, coupon-less, loyalty card-less way to redeem the real-time rewards if they just pay with any debit or credit card.

While several other loyalty providers also allow for time of day promotions — some even extending beyond restaurants to include hotels and other categories — CEO Jon Carder claims that MOGL is actually the first loyalty provider to get a live feed of card transactions. He asserts that other loyalty companies gain access to feeds from banks and payment processors that aren’t in real time. Moreover, these feeds only provide day of transaction data – which isn’t useful for executing time-based promotions, he argues.

Others, like FiveStars, get much closer to real time data – if consumers are willing to provide phone numbers or swipe dedicated loyalty cards though a restaurant’s POS. Carder feels this is a disadvantage. Mogl’s seamlessness is a major step up, he says, comparing it to what Uber did for the taxi industry (to us, this is an arguable point).

Regardless, MOGL’s new flexibility with promotions has also enabled it to pivot its business model. The company used to charge a flat 5 percent fee to restaurants across the board. But now – with rewards becoming variable – it has switched to a flat monthly fee of $199. The fee is refundable if restaurants don’t clear $199 in revenue a month from Mogl users These fees are on top of reward/jackpot fees, which the restaurant can now set for itself. The top three customers in a month at each restaurant win a jackpot bonus. The company allows customers to donate their cash-back to local food banks. More than 800,000 meals have been given away.

Mogl’s new model is also winning it some new customers – including some of the hottest restaurants that had shied away from flat, cash-back reward programs in the past because they weren’t able to change the amount based on time of day, says Carder. Even these establishments find themselves needing to fill their seats on weekday lunches.

We’ll have an extensive rundown of loyalty strategies and issues for SMBs at our Leading in Local: SMB Digital Marketing event Sept. 22-24 in New Orleans. Groupon’s Dan Roarty is keynoting, and our session includes executives from First Data, Mercury Payments and SignPost.. Register here.

First Data Bets on Virtual Gift Cards to Drive Local Commerce

Gift cards have been growing astronomically and now make up an industry nearing $100 billion in revenues. You’ll see racks of cards for national brands and retailers everywhere, from Safeway to Bed, Bath & Beyond.

But can local merchants get in the loop? We’ve seen gift card activity increase in travel, spa & salon and hospitality. Most of these are sold in person or on web sites.

And a second question: can they go virtual, with gift cards stored in e-wallets and easily bought, sold and transacted via mobile phone? While the industry is relatively nascent, Mercator Advisory Group says loads onto digital cards have tripled from 2012 to 2014.

That’s the bet that payment processing giant First Data is making today via the acquisition of Gyft, a Silicon Valley ewallet provider that has contracts with 200 major retailers.

First Data is hoping to extend its own prepaid ties with over 300 national retailers, while also working with SMBs who use its Clover touchscreen POS solution. Its Perka loyalty program customers may also be recruited.

Not everyone thinks they can easily move into Gift cards, however. Facebook, today, announced that it was shutting down its virtual gift card service – apparently, it sees other avenues for getting into ecommerce, such as buy buttons, as more immediate and customer-centric.

Perka co-founder Rob Bethge is a featured speaker at BIA/Kelsey’s Leading in Local: SMB Digital Marketing conference Sept. 22-24 in New Orleans. Check out the full agenda here. Prices go up after July 31.

LevelUp Banks on Smart Watch Adoption for Payments

Phone-based digital payments haven’t really taken off – in part, because they aren’t much easier to use than credit/debt cards. You’ve still got to take them out of your pocket.
The notable exception is the phenomenon of My Starbucks Rewards loyalty program, which now has 10 million Starbucks customers actively using the mobile app, twice the number of a year ago.

But if “wearables” take off – i.e. smart watches and to a lesser extent, glasses – there could be rapid growth. In fact, payments are the most practical smartwatch feature (aside from telling the time.)

LevelUp leader Seth Priebatsch told Marketwatch that has always been his vision. The company currently provides an Android app, which automatically asks users if they’d like to pay by using the App when they are near favorite merchants.

“What we really always dreamed of was being the largest smartwatch payment network,” said Priebatsch, noting that LevelUp already claims 1.5 million smart phone users, who can pay at 14,000 locations. With wearables, the sky is the limit (perhaps).

Seth Preibatsch talks with Mark Fratrik at a recent BIA/Kelsey conference

Twitter Acquires CardSpring; Enters SMB Loyalty and Data Space

Twitter has made a bold move to go beyond advertising by adding performance marketing to its portfolio via the purchase of CardSpring, the San Francisco-based startup. The acquisition price has not been announced. CardSpring had raised $10 Million since its launch in 2011.

One of the big tech challenges in the payments space has been to remake the credit/debit card to a “digital receipt” product that can not only process sales, but also leverage specific SKU information, location and customer behavior to add coupons, loyalty points, events and other ewallet items. That’s the challenge that Netscape Vet Eckart Walther gave himself several years ago in launching CardSpring. The company has been positioned as a value add – some would say “middle man” — to both financial institutions and publishers providing marketing solutions for brands and SMBs.

CardSpring’s ambitious goal has been to enable merchants to write their own promotions; distribute them over CardSpring’s publisher network; and redeem and analyze the deal on their Point of Sales. The service’s “near” real-time analytics can show merchants where their redeemed promotions are coming from and what they bought.

CardSpring first got on the map via a 2012 partnership with payments leader First Data to provide check-in promotions at certain venues. More recently, it has also begun integrating with VeriFone’s POS network to enable developers to build their own card-linked services.

The launch of CardSpring Connect in September, 2013 – described as “Google Analytics for the retail world” was a milestone for the company. Foursquare and MOGL are among the most significant publishers providing CardSpring Connect to at least some of their merchant advertisers. Others include Thanx, Roximity, Moblico and OnStripe.

Twitter’s acquisition of CardSpring makes sense to us as Twitter positions itself as a real time marketing channel, and also a “common carrier” that can work widely across the board with key players in the space. This is consistent with CardSpring’s general positioning. The sale of CardSpring itself also suggests that it has been a difficult effort for an independent company to enlist partners to a middle man solution. It has also been difficult to differentiate itself among several other players providing similar features.

BIA/Kelsey looks deep at the SMB Loyalty and Data Space at Leading in Local: SMB Digital Marketing Sept. 22-24 in New Orleans, with such featured speakers as Groupon’s Dan Roarty, Perka’s Rob Bethge and Mercury Payment’s Randy Clark. You can register here.

Priceline Moves Upscale via $2.6 Billion OpenTable Acquisition

Priceline is sort of like eBay – a company known for its origins in auctions, but more recently focusing on distinct, “buy it now” niches. It has recently fleshed out its core travel brand by moving up the value chain to travel reservations via its acquisition of Kayak. It has also gotten into the “sharing economy” by adding AirBnB-like private listings to its Booking.com brand, which is an international powerhouse.

Today, Priceline added restaurant reservations and search to its stable via the $2.6 Billion purchase of industry leader OpenTable, which works with 31,000 restaurants – mostly high end white table cloth restaurants willing to pay a hefty premium for reservations management and leads to undecided consumers. Open Table is an international leader with strong customer bases in the U.S., U.K.,, Germany, Japan and Mexico.

For Priceline, the most attractive parts of the deal are probably OpenTable’s 15 million, high end, travel-oriented customers; the company’s verified, high quality restaurant reviews; OpenTable’s strong mobile orientation; and its extensive affiliate network with 600+ local and vertical sites, which receive commissions for sending traffic to OpenTable (and accounting for 5-10 percent of OpenTable’s business.) These networks might be extended to include other Priceline properties.

There is probably some disconnect with OpenTable’s high-end customer base and Priceline’s discount set – most OpenTable customers won’t be using Priceline itself. And an effort to extend OpenTable’s feature set with Groupon-like deals proved to be underwhelming (although the company has maintained an extensive and apparently successful “Dining Checques” loyalty program). Many OpenTable customers are also not using the service in travel mode — they are local.

Still, OpenTable customers might use the other services. And the seamless Priceline app experience could also be applied as mobile becomes a paramount factor for all travel services.

A larger question we’d have is the core of OpenTable’s value proposition for restaurants: the reservations management system, which is based on dedicated customer premise equipment (known as The Electronic Reservations Book.) The average ERB using restaurant pays $249 for the service (plus $1.00 per seated diner using the OpenTable system.) But in the age of tablet-based POS and reservations services using WiFI, OpenTable’s proprietary system would seem threatened.

So far, it has held its own against such tablet-oriented companies as UrbanSpoon’s Rez and Groupon‘s Breadcrumb – OpenTable’s base of customers is too strong to quickly turn off. OpenTable itself is preparing for a transition. Yet, it has been developing a Cloud Based program that charge a $2.49 per diner charge.

Structurally, we also ask ourselves whether OpenTable is in a distinct “high end restaurant reservations silo,” where it now sits; or whether it is really part of a developing “food silo” that is based on search and discovery, would also include reviews; restaurant and fastfood delivery (i.e. GrubHub), grocery delivery (Amazon Fresh, Google) and reviews (Yelp.) Priceline might be positioning itself to be in the right of the middle of these conjoining elements. (then again….the new silo might ultimately be oriented more around delivery).

DataSphere: Opportunity in Mobile Advertising for SMBs

The times are a changin’ when it comes to SMB customer acquisition. Non-traditional options – including the use of social media, mobile targeting and promotional calls to action – provide opportunities for SMBs looking to take advantage of shifts in consumer behavior.

Few companies have been as energetic in capturing this shift as much as Seattle-based DataSphere, which has quietly amassed 20,000 SMB accounts, making it one of the largest SMB marketing platforms.

Changing with the times, DataSphere is moving its focus away from buying ad space on local Websites. Instead, it has developed a set of services based on mobile ad networks, which can target customers on a geotargeted and just-in-time basis.

The company is also focusing on LocalSaver.com, a coupon portal; and the LocalSaver Network, a distribution network. LocalSaver goes beyond coupons to provide SMBs with enhanced features such as landing pages, updated listings designed to maximize consumer engagement and video. (DataSphere has built videos for 90 percent of its customers.)

The rise in mobile usage, in particular, has led to a major boost in SMBs’ use of geotargeting – and in the availability of geotargeted ad exchange inventory. Seventy percent of LocalSaver traffic is now lat/long enabled, says SVP Gary Cowan.

This is an edited excerpt of a new BIA/Kelsey client brief, “DataSphere: Leveraging Mobile Advertising and Changing Course with 20,000 SMBs.”