Dec 1, 2014

Twitter tries out coupons despite everything American Express, Visa, MasterCard and Bing taught us

Lots of companies have tried and failed to blend social media and retail. American Express, Visa, MasterCard and now Twitter use credit card-linked offers that rely entirely on a coupon clipping analogy. All have failed or will fail. It’s time to try a new analogy. Loyalty marketing is a much more effective analogy. I’ll explain why.

I’ve watched the coupon clipping concept come back around every few years, failing every time. I’ve even provided the back end systems that enable this, so I’m intimately familiar with it.

This article in Wired nails the problem: "In order to redeem Twitter Offers, consumers have to link their cards, complete a transaction, and then go offline and visit the store with the offering. And even after a buyer visits a store, they will have to wait to see if their money gets credited back to them—because it’s not an instantaneous discount.” Talk about friction.

There is lots of friction for merchants as well: “You, as a merchant, have no idea who redeemed, who was looking at the offer, etc. There are no details or analytics around it. And historically, banks and credit cards haven’t shared that information.” Of course not, because they can’t.

Taggo’s approach is to use a loyalty marketing analogy instead of coupon clipping. Customers don’t need to link their credit cards. All that’s needed is to like the merchant on Facebook or follow them on Twitter, then give their mobile number to the cashier whenever they shop. Merchants get detailed information on who shopped in their stores, when and how often. Just like a traditional loyalty program but without membership forms or cards. And without the need for expensive CRM and loyalty marketing systems, since everything is built into the merchant’s social dashboard.

Taggo’s “Fan Club” platform is currently available only on Facebook. Here is a concept video showing how the technology would look with Twitter integration.

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