Tag Archives: Closely

SFSW: Taking on Punch Cards with Loyalty Marketing

Loyalty and engagement programs are now flooding the local ecosystem. They see themselves as the next step up from daily deals. At the same time, they hope to be more effective than “buy 10 get one free punch cards,” according to execs from LevelUp, Swipely and Closely who were among htose who spoke at Street Fight Summit West in San Francisco.

Level Up’s John Valentine says results from his company’s loyalty program are already apparent. The discounts and loyalty points give consumers a better feeling of value, and in a review of 500 locations, have resulted in consumers paying seven percent more on average compared to regular tabs, he said.

Valentine acknowledges that the audience is self-selective. The fact that they have an iPhone suggests they’re more affluent. But it has “gone beyond the cool factor,” he says. “Using a phone for paying is becoming more normal.”

Mostly, however, Valentine says the race is on to gain a strong customer base. Level Up claims 200,000 users after just nine or ten months, and it is growing 20 percent month over month. It winds up paying $5-8 apiece for customer acquisition, he said. Even if the industry does a fast switch into NFC, and starts working more with entities such as Google Wallet, “ we don’t care,” Valentine added. “We will have a base of customers” and will be in a position of strength.

Swipely’s Angus Davis, meanwhile, suggests it is not going to be so easy getting that customer base. “Acquiring consumers is very difficult,” he says. Swipely’s approach is to build up customer loyalty, and after several months of experimentation, get them to develop restaurant specific loyalty programs.

Ultimately, it is all about fostering more repeat business for restaurants, says Davis. Sixty percent of their business comes from repeat business. Getting customer engagement and providing rich analytics will win merchant accounts over from the legacy of credit card accounts, “where bi-furcation and crust has built up.”

A different approach is being taken by Closely. CEO Perry Evans said that that the key is to give merchants “tools that get to the heart of loyalty.” Evans is especially intrigued by CardSpring, the new loyalty and promotions platform that allows consumers to opt-in to various deals and services. It puts incentives in front of consumers at a time that makes sense. “You want to give them the remote control so they can turn things on and off and decide what channel they want,” he said.

“Consumers are living their lives facedown into their phones and into their network,” said Evans. “Shopping decisions are becoming more live and based on a new combination of quality (review related) and price (putting incentive in front of consumers at time it makes sense). Give them the remote control to turn things on and off and give them a channel,” he said. That will beat Facebook. “The tools are not there. It centers only around the display ad category.”

Closely Launches ‘Social Select’; Moving Deals Away from Mass Market

If you are a small business, what do you do after you run the daily deal? Or how do you run a daily deal-like promotion “safely,” without hurting your brand? These are the questions that a number of start-ups have posed for themselves as they seek to dive in to the deals revolution, while differentiating themselves from the cluttered destination deal and white label deal marketplaces.

At ILM East last week, we heard from WildFire Apps and Closely — a new, Denver-based company from Mapquest and Local Matters founder Perry Evans that formally debuted its “Social Select” service at the conference (and which we wrote about last July.) Evans says Social Select tackles the two major flaws of the daily deals space with social media.

The first is the “very, very low” percentage of return visits, which he says is often under 10 percent. The second is the sense that merchants look like they are desperate for business, harming their “brand and margin value.”

Closely’s solution is to work with merchants to bring in existing customers and attract new customers via a “connect, referral and social network.” It is an “everyday, social commerce” approach,” says Evans. The mass market appeal of a daily deal is under-performing outside of “maybe 10-15 core categories,” he suggests.

The offering is made up of two parts. First is a “private deal” for preferred customers and friends, which is akin to a “manager’s special.” Merchants hand out pre-printed cards with QR codes taking them to a 24 hour deal. Customers can hand them to five friends. “It allows you to hand select your next lead,” and shift to “better targeting and engagement,” says Evans.

The deals are also very flexible. Cards can be handed out for different deals, based on the interests of the customer. “You could have nine different deals,” he says.

The card idea is thought to be ideal for such recurring categories as home services, automotive services and pet services. “You don’t get a recurring customer from one visit. It takes five or six visits,” says Evans. He adds that the use of a deal card does not preclude a loyalty card that provides discounts or free services after a certain number of visits. It is just a different concept. Evans notes that the program have now been field tested with three partners/agencies.

The other part of the Closely concept is the management of social media promotions and includes widgets for updating merchant Web sites, Facebook and Twitter. The company enables all relevant categories to be displayed, and to develop a “curated social graph.”

Perry Evans on Closely: ‘The Social Graph’ is Overtaking E-Mail Marketing

Small businesses are gaining the ability to interact with customers anytime, as email marketing gives way to “the social graph,” says local marketing pioneer Perry Evans, who is introducing Closely Inc., a new firm dedicated to helping SMBs leverage the new opportunities in online and mobile marketing.

Like everyone else, Evans says he has watched the rise of Groupon and pondered what role daily deals have in the new marketing. His answer: they are great “training wheels to demonstrate to businesses how powerful social networking can be to stimulate demand.”

But more comprehensive solutions are really needed. “The daily deal model simply organizes an audience for a specific metro-area deal, campaign-style. We need a broader term than ‘daily deals,’ says Evans, offering up “live local social marketing” as a candidate. “This captures the real-time and socially engaged ways that marketing will shift into a key small business tool for demand stimulation.”

Closely is being designed specifically to meet these needs, adds Evans. Businesses should be able to create live deals anytime, when they most want/need demand. At the same time, Closely is building an engine for expanded offer distribution.

“Offers will get to consumers in variety of ways,” says Evans. “The industry has centered on a campaign email model; yet the user spends a ton of time on local and social websites, in search and on mobile devices. Getting offers published when businesses most want leads, and delivered through multiple channels is the best way to describe what we’re about.”

Ideal SMB customers for such a service are more local service oriented than product commerce oriented, he says. Product commerce granularity can be overwhelming, while offers from local merchants and service businesses seem to be welcomed right now by consumer. “This implies a meaningful opportunity for Yellow Pages as partners, alongside daily media, mobile and email distribution,” he adds.

Perry Evans’ New Thing: Groupon-Like Closely, Inc.

Perry Evans, a founder of Local Matters and MapQuest, has launched a beta version of Closely, Inc., a new group-based promotions company, joining the 100 or more companies that hope to follow in the footsteps of Groupon, and perhaps improve on it. Groupon has over one million registered users.

First up is a Business Edition, a real time service that allows small businesses to centrally launch, manage and measure promotions via Facebook and Twitter, enabling them to build their customer base and manage demand with real-time, socially engaged offers. The service connects a live offer page to each social media post.

Evans tells us the eight person company is being positioned, in part, to “help traditional media companies get better at this.” Instead of hashing together a new technology on top of an old technology, this is all new, he says. “If direct marketing were being created now, it would be done this way.”

Live Offer Example Screen