While there are many marketing tactics, apps and startups
focused on delivering deals to consumers, edo is different because
it requires the bare minimum effort of the part of the consumer.
Once the offer is linked to the credit card, there is no other
requirement, no additional card or code or coupon. It keeps the
customer's existing routine intact without adding extra steps.
Here's how it works:
The marketer can offer highly targeted deals to a specific set
of consumers, based not (just) on demographics, but on purchase
history -- data gleaned from those bank partners. The targeting
criteria will reflect the goals of the specific retailer, be it
limited to just new customers or perhaps increasing the basket size
for existing patrons.
The banks are responsible for communicating the deal to the
consumer through web and mobile channels. For them, this is seen as
a "value add" -- a benefit exclusive to their card members and
something those banks can tout as advantage over competitors.
For the consumer, the key is simplicity. Upon receiving the
notification from the bank -- via email or directly in the mobile
app -- all the user has to do is accept the deal. And because it's
tied directly to a credit card they're already using, there are no
special codes -- alphanumeric, QR, or otherwise -- no coupons to
clip or loyalty cards to dig up. Just swipe your card as you
normally would.
When it comes to user behavior, laziness trumps all, which is
why cumbersome apps and confusing QR codes haven't caught on.
One of the retailers that has tried edo is one of the
most-afflicted by "showrooming," where consumers browse the
physical store only to make a purchase online.
But you never really know how consumers will react to new
technologies, which is why rather than testing this on Black
Friday, Best Buy ran a trial program back with edo in May, aimed at
both driving new customers and lifting basket size. Of those who
redeemed the deal, 80% were new customers, 25% of whom came back at
least once within 90 days, without further incentive, according to
edo VP-Marketing Jeff Fagel.
Best Buy didn't respond to a query and thus didn't confirm the
accuracy of those numbers, but the electronics retailer is planning
to launch an expanded version of the program on November 26, which
says something about how the initial program performed.
Edo isn't just good for big retailers during holiday-shopping
season; it also works well for smaller niche players and can be a
valuable tool all year long, according to Emery Skolfield, the
senior director of e-commerce for The Body Shop.
"As a smaller-sized retail brand that doesn't have tremendous
awareness in U.S. market, we are always looking for opportunities
to get in front of consumers in ways that are A) convenient for
them and B) close to sale," he said.
Mr. Skolfield said edo's card-linked offers have proven
effective for The Body Shop since implementing the card-linked
offers in March, as a measurable, easy-to-implement alternative to
physical displays that point people to the store." It's e-commerce,
but it drives foot traffic and it's measurable -- as opposed to a
sign outside the store," he said. "Being a smaller entity without
major technological muscle, we look for programs like this that are
simple to integrate but can make a big impact. We can't make three
custom-built iPad apps, but we can look for programs like this that
give an advantage."
In September 2012, edo announced $15 million in series C
financing led by VantagePoint Capital Partners with participation
from Baird Venture Partners, bringing the total funding to date to
$54.3 million. The five-year-old company works on a
pay-for-performance model and merchant partners have included
Nordstrom, Target , Subway, Crate & Barrel and The Home
Depot.
