SpotOn: Loyalty Site Argues Against Card Links

A major feature of the current crop of loyalty and rewards programs is that they link to credit card or debit card accounts. This gives them the ability to process transactions and provide deeper analytics.

But a number of players are skipping this step. The list includes developed players such as Closely, Plink, Shopkick, Cardagin, Spreebird Rewards and SpotOn. One reason they might avoid card linking: it is an extra step that is difficult to manage and scares away potential customers who might be reluctant to provide that information to an unknown company.

SpotOn CO-CEO Doron Friedman goes a step further. At least while the company is in launch mode, “we don’t want to be data dependent on a third party vendor,” he told us. The position against credit and debit card links is especially interesting since Friedman and co-founders Zach Hyman and Matt Hyman are veteran entrepreneurs in the payment space, they founded both CardPayment Solutions in 1999 and Central Payment in 2005.

While credit card or debit card info is certainly useful in getting a broad view of customer behavior, Friedman and company co-founder Zach Hyman says it is goldplating their actual needs. Many SMBs don’t need all of it. The critical analytics that SpotOn provides to merchant customers are all there, he stresses: frequency of visits and date of last purchase. Analytics should be in easily digestible chunks, they say.

SpotOn’s focus is to incent customers to come to merchants in their network, primarily via email, mobile apps or social media. With this, the merchant will be able to send out messages or deals to their customers with a click of a button. The company is charging an introductory rate of $40 a month, which includes a loaner Samsung Galaxy tablet for in-store signups. Services are free for the first month and month to month after that. More than 1,500 merchants have been signed, with 500 new ones coming on every month..

While technology interfaces are important, merchant outreach is going to be a real differentiator, add Friedman and Hyman. SpotOn’s principals have self-funded about $5 million to jumpstart the company, and a portion of that has been spent on developing a sales network of 50 sales people in its existing markets such as Southern and Northern California, Texas and the Mid West.

Local sales in my (adjacent) hometown of Encinitas, CA, for instance, has gotten 40 merchants signed to the network, with ten being added each week. The company is also developing reseller arrangements. Training is in the works for a network of 1,000 Central Payment agents to supplement local sales and also provide national accounts.

The company also has an operations staff of 35 located in its San Rafael, CA headquarters, with technology in Chicago.

This Post Has 2 Comments

  1. Suzanne Bradley

    Great article! We’re finding that merchants love the simplicity of the program. The customer facing tablet reduces friction with the staff, and the web based dashboard provides powerful analytics while making it easy for the merchant to connect with their customer base via email, SMS (txt) phone push (for smartphone users) Facebook and Twitter.

    To learn more, or for additional information, contact Suzanne Bradley, Area Sales Director, at 317-213-4172.

  2. Dean Ethridge

    Great article and I’m excited about being able to offer Spoton to new clients. They are truly loving the service and how Spoton is able to help them in their business. Every retail establishment should consider Spoton as a way to increase their profits through customer loyalty like the big guys but in a much simpler format.

    Feel free to ask many any questions about the program or call (205) 390-0005

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