Interview with Founders, OffersforShoppers

i reviewed OffersforShoppers a few days back and found the service very interesting. But at the same time, I had questions on scalability/ automating the entire deal process etc.
So, I went ahead and did an email interview with Setu, one of the co-founders.

Qn. How do you go about collecting the discount details? Please share the entire process:
We follow the following simple process for deal closure and details collection.

Contact Vendors over the phone -> Arrange one-o-one meeting -> Close the deal
Modes of collecting offers from registered vendors

  • Collection at the time of deal closure
  • Online ‘Add an Offer’ feature – Registered vendors can add offers directly
  • Through e-mail – Can send offers through email
  • Over the phone – Can inform about offers over the phone

Qn. Given that collecting information from retailers is a manual process, how do you plan to scale this model [to other cities]

We’ll be coming up with following facilities to scale up the operations inside city and across the cities –

  • Online registration facility for vendors – This way we can increase the vendors registration and adoption without any manual intervention.
  • Personal login accounts for vendors to manage their offers and advertisements – This way we’ll be able to offload some of our involvement in daily operations of offers management for individual vendors.

These measures will help us grow across the cities but definitely can’t be a complete substitute of our standard process of tele-calling and one-o-one deal closure.

Qn. What segment of retailers are you guys planning to target?
We don’t differentiate among vendors or categorize them based on their size. Our target customer is any vendor having offers. Our mantra for vendors is to “Make the advertisement world flat” and that’s driven by our passion to ensure that all vendors irrespective of their size get equal opportunity to promote their products and offers. It’s win-win for both vendors and customers.

Having said that, we would definitely like to acknowledge that value of our service is more attractive for small and medium retailers [SMEs].As big retailers have big budgets and enough money to spend on different media like print, radio, television and OOH for advertising about their offers, they might not be very much inclined towards our service at this stage. But our nominal upfront cost and performance based pricing model definitely gives good weapons to SMEs to fight against biggies of the world. So if you talk about our potential customers, we would definitely like to claim SMEs to be those.

Qn. Tell us more about your mobile strategy.
With OffersForShoppers, you can “get offers, on-demand”. We want to ensure that users get offers for whatever they want and whenever they want. And our mobile strategy complements the mission of doing that, the mission of making offers available on-demand.

We’ll be coming up with short code based mobile search functionality through which users can search offers on-the-move and receive mobile coupons/ codes whenever and from wherever they want. For e.g. a customer roaming around in MG Road can receive coupons/codes with vendor’s details for buying jeans by sending sms “offers jeans mg road Bangalore” to our short code XXXX. This way customer can get offers on-demand and need not roam around the city to avail a good offer.

Another small integration with mobiles will come in terms of receiving coupon codes directly from site. As of now users can print coupon or receive coupon codes in emails. Very soon we’ll be coming up with web-2-mobile coupon code feature as well. This way, users will be able to receive coupons directly in their mobile and redeem it by showing it to vendors.

Qn. If possible, do share some info about the company/investors.
OffersForShoppers is driven by the passion of ensuring that users can “Get Offers, On Demand”. Be it recognition in international trends magazine ‘Springwise’ for innovative idea of “Social Tagging” or approach by a BIG Indian online shopping site for possible acquisition, OffersForShoppers is being appreciated for the value it’s creating for users.

We launched OffersForShoppers some four months back in Bangalore with two founding members Sibani (B.Tech ‘03, Orissa University), Setu (B.Tech ‘03, IIT KGP), Mukesh and Shweta – all first-time-entrepreneurs, and today we also have pre-launch set-up in Delhi as well. We’ll soon be announcing our public launch in Delhi. We are self funded till now but are exploring the options for raising angel funding.

Some of our future plans are –

  • Mobile based coupon
  • Location maps of Vendors Address
  • “Demand it” – This online feature to demand offers will supplement our ‘Interest sharing’ based idea of ‘Social Tagging’ which captures the interest of users for existing offers and helps in getting bigger discounts. Based on idea of ‘Intention sharing’, ‘Demand it’ will help users in getting offers for whatever they want just by declaring their intentions.
  • Search on-the-move
  • There are many more to come which we can’t announce as of now because of their being critical and strategic in nature.

Qn:What’s your business/monetization model?
A nominal one time account setup charge + cost per redemption (CPR) charges

This makes it very convenient for SMEs to promote their products (unlimited offers for unlimited time) because they don’t have to pay high upfront cost without knowing the results and they have to pay only for performance/sales rather than clicks/leads/impressions (which only biggies can afford). That’s why we said, our potential customers will be SMEs and biggies will move to this model when we have created a brand for ourselves.

Qn:Your punchline reads as “Saving money and Trees together” – Explain the trees part.
If you see the coupon usage and their mode, it’s mostly printed coupons which are distributed through different means. For e.g. in India Domino’s distributes coupon with each home delivery order, VLCC pushes coupons as paper insert/pamphlets etc. But hardly 1% of these coupons are actually used. That means we not only lose coupon-savings and but also waste a lot of paper on such kind of promotions. Another figure from USA market reveals that 50% of the newspapers are bought there just to clip coupons. And following report reveals another disturbing aspect of printed coupon usage.

“There were 335 Billion coupons distributed in 2005 in the United States, and 4.5 Billion coupons were redeemed.”
(CMS, Carolina Manufacturer’s Services)

“American consumers saved $3.2 Billion last year by using coupons, but they threw away $315 Billion in potential savings”. (CMS)

You can see from the figures how many trees are cut just to do these ineffective promotions. This was the motive why we came up with idea of printable coupons so that customers can print it whenever they need.
Thus coupons won’t be pushed to people but will be used by people whenever the need it. We are also planning to come up with coupon codes, mobile coupons, sms based coupon code to further reduce these print/paper uses. Thus saving trees was another motivation behind this initiative.
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