September 01, 2012

The Next SoLoMo Killer App I have seen the post-Groupon SoLoMo retail solution. It’s called Leloca. And it’s running a Beta in New York with 1000+ consumers and 200+ restaurants, spas, gyms and shops. It simply and elegantly delivers the universal technology promise; immediate value exchanges between merchants and consumers and, in so doing, joins Zipcar and Airbnb in efficiently using technology to allocate time sensitive resources. Founded by Douglas Krone, a sushi-eating, dog loving Northwestern grad and serial entrepreneur, Leloca has a development team in India and 15 employees smiling and dialing to enroll merchants in Chicago. The mobile app is designed to sell available inventory, mostly restaurant seats, in real time. Merchants determine when, where and what they want to offer and set the parameters in a simple dashboard. Consumers get alerts and offers from the app. Merchants get free listings and pay just $1 per customer, validated and tracked by a unique code issued directly to each participating customer. For retailers, Leloca gives sophisticated yield management tools to smaller retailers with no investment in technology. Using a simple interface, merchants set the offer, the number of deals available, the time parameters and the geographic target. Some select a near-in trading zone; others opt for an exclusion zone to attract new customers from adjacent areas. Unlike Groupon, there’s no revenue share, no required loss-leader offer and no opportunity cost. And during the beta period, new merchants get 3 months of free service. For 116 million US smartphone users, especially the 8.9% who use their devices to seek out discounts or offers, the always-on iOS or Android app feeds you deals. There are no vouchers, no credit cards needed and no fine print. Deals are pushed to you. If you bite, you get a code that is live for 45 minutes and redeemed at the point of sale. It’s exclusively mobile, immediate and easy. The next wave of apps uses GPS and mapping linked to a rules engine platform to create productive in-the-moment experiences. They require little or no effort from consumers and can be shared via social networks to enable frictionless retailing.
3 Imperatives for Creating Your Own Online Community The intense growth of social networking is driving interest in gated private and online communities. This is especially compelling in highly regulated sectors like pharmaceuticals and financial services, where brands have been mostly sitting on the sidelines watching as communities grow and converse without them. And while it’s easy to imagine how great it might be to focus your customer's attention on your vertical, to connect your brand advocates and to observe and mine the rich dialog among the faithful, it’s much harder to pull off than it seems. Marketers should think carefully about what kind of unique customer experience an online community can offer and what kind of business result is likely to come about as a direct consequence of an investment of time, technology and resources necessary to bring a community to life. The availability of software tools plus the desire to integrate a community into an existing website doesn’t necessarily make the prima facia business case. With all the existing communities and social network options, it’s unlikely that even your best customers are desperately waiting for you to create a platform for them to interact with. And don't forget, even if you build it; they might not come. But if you are dead set on creating a community and you can convince management to invest, bear in mind three critical factors for success: 1. Have a Solid Business Plan. A gated community has to drive brand loyalty, stimulate purchases and re-purchases and develop referrals. If it doesn't, it’s not worth the effort or the cost. And even though it’s hard to accurately forecast revenues produced by online communities, plan to make money and set up metrics to gauge the fiscal impact on your business. 2. Focus on Content. Run it like a Cable TV Channel. An online community lives or dies on programming, usually narrow, niche, unique programming that speaks directly to specialists and helps them connect the dots. Picture your users and super-serve them. Everything you do and every feature you add has to provoke tune-in and time spent with you. If the content isn’t plentiful enough and compelling enough to drive this level of engagement; don't do it. Assume your community members have a small amount of precious time to spend. And assume they are mercenary in allocating it. If they don't get value every time they tune-in, they stop viewing. Give them what they want. Reward them for taking the actions you want them to take. Keep a tight focus on content. Police the comments. Provide expert advice and interventions. Expose the brand's insights, expertise and point of view. Share with the community the kind information you'd share with a trusted client during a quarterly business review or with a high value prospect on the third sales call. Give them a sneak peak at future products or services and/or an offer member’s early access or better pricing. 3. Have One Person Run it. Nothing says its real than the allocation of one fully loaded full-time employee. Find the programmer on your team and make customer engagement and business results their reason for being. Make their raise or bonus dependent on KPIs like repeat visits or time spent per session. When authority and responsibility are shared, there's no one to blame and too many shoulders get shrugged. And unless you are a very small shop, coordinating all the moving parts that go into an effective online community and keeping the lawyers at bay is easily a full time gig for an up-and-coming marketer. Marketers across verticals have a persistent fantasy about mobilizing customers and prospects online in carefully curated communities. It’s a terrific fantasy. But it’s much harder to pull off credibility and with positive ROI in the face of established and growing social networks. You need a compelling reason for being and the willingness to invest in software, content and at least one dedicated FTE to make a serious stab at it.

Danny Flamberg

I am a veteran marketing consultant working with leading and emerging brands

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