The Keys To (Revelevant) Local Commerce Are Now Within Reach

So since we all now know daily deals aren’t the holy grail of local commerce, it begs the question “WHAT IS the holy grail of local commerce?”

I’ll throw in my hat and suggest a real-time product and service discovery platform within your local community would be a strong contender.  Imagine if the right information hit your mobile device just at the right time, suggesting (or urging) you to make a purchase or buy a product from a favorite merchant of yours, who happens to be right in front of you at the moment.

keysIt’ll happen.  And OfferSavvy is already treading in these waters.

I spoke with Justin Boggs, one of the OfferSavvy founders about the future of commerce, where he sees it going and how they are looking to roll out their product discovery platform.

A few years ago Boggs started to think about how Groupon, LivingSoclal and other daily deal sites were taking huge cuts from each deal sold but not adding much value to local commerce.  He thought “how do we track offline transactions, and do it better and in a more healthy way for the local economy?”

After going through Bizdom, an accelerator in Cleveland where they got advice and connections, they are now headquartered in Long Beach, CA and rolling out their first version of the product as we speak – a personalized product discovery platform with CashBack incentives on any purchases through the system.

Ideally, they aim to build out this commerce platform and offer it to brick and mortar companies to establish a full blown local product recommendation system, akin to what Amazon does on their properties.

The goal is to create something meaningful for business owners and local consumers, with cash back incentives for both if they opt for social sharing.

I sure hope they succeed, I cannot wait to get relevant deals and offers from a system that actually knows who I am, knows my interests, knows my favorite local merchants and understands my purchase history.

You can read the entire back and forth conversation below.

What is OfferSavvy?

OfferSavvy is a social commerce marketplace where people come to discover, share, collect and buy their favorite products. We incentivize social activity and reward users with CashBack Offers on Products and Social Bonuses when their social activity leads to sales. Users can elect to have their earnings deposited into their bank account or they can donate those funds to charity AND OfferSavvy will match that donation.

We believe we have figured out how to truly create social engagement around the shopping experience in a meaningful way. Most importantly, our goals are to present each user with a personalized experience and a wall of relevant offers. So with our advanced recommender technology, artificial intelligence machine learning software, graph database, and natural language processing capabilities, we can acutely monitor a users interaction with our website and people on the site, and then begin to customize the experience for each user. Thus we help people shop for fun and with purpose.

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What’s the vision?  And what problem is OfferSavvy solving?

OfferSavvy is shopping evolved. People love to window shop, score great deals, and tell their friends all about it. OfferSavvy delivers that experience in one place, and we help people earn some extra cash based on their social connectivity. Moreover, the best form of advertising is word of mouth. Big brands and marketers know this. You probably realize this too, as your friend’s opinions are more important to you than some paid advertisement.

So, we encourage our users to be social and share offers that they discover through OfferSavvy. And each track every link that is shared. Therefore, when any social activity leads to new signups and sales through OfferSavvy, we give a little Social Bonus to the user for being the catalyst to that activity. Every user now has the power to earn dollars just for being social. Plus for the millions of American’s that need their dollars to stretch just a bit further, every product on our platform has a CashBack offer attached to it, so you can find the products that you really want- and earn CashBack in the process.

Our longterm vision for OfferSavvy is to build out the commerce rails to allow any business to actively engage with us and make Offers through our platform. This will give our users a unified experience, and allow them to stay on our website rather than be redirected third party websites to buy products. In addition, we have already written card linked offer software, as a means to close the loop for offline redemption in store. So, when I am able to build out this vision, OfferSavvy will be a grand catalog of CashBack Offers, both online and offline, to your favorite brands and merchants. We will be able to serve up real time, geo-located, personalized, mobile and cardlinked offers for our users. This way we can help people earn rewards off of every transaction they make each month. If you think about all the money you spend each month, how meaningful would it be in your life to get 5-15% of that back… we can truly impact lives here, while building cool technology.

How do users discover and use OfferSavvy?

We just went live last week, so we have started contact all of our friends, family, and connections directly. So people are coming to the site mostly through a direct link to the site. In addition, the website is built on the premise of social shopping, which means that each of us spends time using the product, creating collections, and sharing products with friends through social media. This has lead to promising traffic from Pinterest and Facebook, and a couple of visits from Tumblr and Stumbleupon.  As time goes on, traffic in large part will be through natural search for products, and given are large catalog, we can compete for page rank.

What’s the story behind OfferSavvy?  Any lessons to share?

The initial thoughts and ideas were came to me a few years ago, since that time I have continue to iterate and cultivate what is now OfferSavvy. Officially, the company was started June 2012, when we got some initial seed funding.

Some things I’ve learned from building startups is that nothing happens unless you do it, and you can truly never expect anybody else to be invested in your ideas the way you are. So you really need to be passionate about what you are doing, and love working, because for the first several years, work life balances shouldn’t exist- if you want to build something truly impactful.

Another interesting thought is just how startups are a lot about “hurry up and wait”. You have this grand vision for what this thing could be, and you want it tomorrow, but come to find out that it is going to take quite some time to build such a thing.

Also, as the founder, remember that you don’t have to be the best at everything, instead try to be the maestro, and get the right and best people for each role of the orchestra.. the genius is witnessing the music as your group plays in concert, in harmony.

What is the company’s current status? (funding, beta, users)

We have raised a little over $300k in seed funding thus far. We now have a live product open for consumption, and watching intently as users begin to interact with our platform. Ideally we want to use data and user feedback to shape this into the product that people truly want to use. And we can take the evolution in development and modifications in stride as we have structured release cycles in agile development. This allows us to be nimble, and redirect development efforts quickly as users begin to tell us, and show us the right way to go. We are also looking to raise additional funding that would give us a 9-12 month run rate, so we can focus on user acquisition and engagement on the website.

What’s next?

We have some fun hacks under way as we speak that is truly ground breaking. In the next few weeks you can expect to see the release of some social products that are completely unique to OfferSavvy. One such hack will allow users to not only make comments on products or collections, but respond with hashtags.  You might say, “Hashtags” aren’t new? To which I reply, ‘what if’ every hashtag pulled the top user generated tweets & Instagram Pics in real time into the thread?  People would not only be discovering new and interesting products, but they would find additional rich social content surrounding that product.

So with a hashtag system in place you could not only read what people think or how they feel about the products, you can see the latest tweets about the product from all over the web attached to that hashtag, and you could see the most recent Instagram Pictures that people snapped with that product or brand with that hashtag. Check out our “Featured” section today to see this in action in a slightly different way, but it will give you a good idea of the direction we want to go socially.

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People Actually ‘DO’ Want To Make Mobile Payments If It’s Easy Enough

I had a good feeling as the month of May was progressing we would be seeing some awesome Seconds numbers.  But since we are now into June and I was able to get some time to crunch the entire May results, I am astounded by what we are seeing.

For those of you who do not know, Seconds is a fast and easy way to make payments with your mobile device.  We automate payments through words sent in simple text messages (cool Siri video below) and shorten a minutes worth of transaction time into just a few seconds.

Below are a few charts specific to our pilot test around mobile payments.  The first one is for total monthly transactions and as you can see, the growth from January through May is accelerating.  (Chart actually starts with early testing in December.)  In fact, the change from April to May is most impressive.   In April we had 384 transactions and in May we completed 615 transactions.  Blow-out month for sure!

Monthly Transactions

Going further in depth on the numbers, some very interesting consumer observations emerge.  We took the entire user population and parsed out categories based on the number of times an individual made a transaction.  Specifically, we evaluated May and compared it to the previous month of April to see if we could identity any trends in usage.  Here’s what we found:

Findings:

1. The number of people making 10 or more transactions in a month DOUBLED!  This means as months go by people become more comfortable with using the system and more apt to make a quick purchase in Seconds.

2.  The overall user base grew 48% from April to May.  We continue to gain more users who easily jump into the system and start making payments using their mobile device.  Uploading payment credentials securely in the cloud just once is all it takes for a new user to start using Seconds.

3.  Roughly 2 out of 3 Seconds users are multiple purchasers.   This means they returned within the month and transacted at least twice using Seconds.  This is a very good sign.

4.  An astounding 82% retention rate is HUGE!  More than 8 out of 10 users in the month of May were users in the month of April, proving that we are not seeing much drop off once an individual enters the system and starts using Seconds.   Although adding new users is a driving force, more important is the ability to retain the ones you have already attracted.

Our assumptions are continually proven true and the lessons here are manifold.  When offered a quick and easy way to complete a transaction using their mobile device, people do it!  And time goes on people are more comfortable with making more payments by simply sending a text message.

Now, what if you could pay your rent that way?  Or refill your transit card?  Or rent a movie?  Or all the other areas of your life you want to take care of in Seconds.  That is why mobile payments are set to be a $1 trillion industry by 2016 and automated application-to-person payments are an estimated $100 billion industry.  We are only getting started.

The 2 Slides in Seconds Pitch Deck That Will Knock Your Socks Off

Over 4 billion people around the world don’t hold a smartphone or have the ability to download a native payment app, but that shouldn’t exclude them from the mobile payment experience.  All signs are pointing towards payments following the changes mobile technology is bringing to the rest of the world, and if history has anything to say about it a new platform will have to be built from the ground up.  That is why  we are building Seconds.

Seconds is mobile payments using the most intuitive experience we have on our mobile devices – text messaging.

Using the Seconds platform, brands have the ability to identify specific keywords that when sent to their Seconds number automatically trigger transactions for the accurate amount.  We see a whole new payments market opening up where no human being has to be on the other side receiving the payment.  We call these experience Single Party Transactions and they are estimated to grow to almost $10 billion by 2016.

How cool is Seconds?  Here are 2 slides that will knock your socks off.

view demo video

Mobile transactions will drastically change our society and the market for paying by mobile device is said to be well over $1 trillion by 2015.  Most significant will be the transformation in how we use our mobile devices in everyday commerce.