Entrepreneurs / Small Business  December 17, 2010

DuckDuck Deal puts new spin on ads

BOULDER – Everyone knows there’s no such thing as a free lunch. But what about one that’s deeply discounted only for certain people in a certain area? About 180 businesses throughout Boulder and Fort Collins are trying the concept out with DuckDuck Deal.

This smartphone app, available for iPhone and Android operating systems, uses the phone’s GPS capabilities to find time-sensitive dining deals at nearby eateries.

While the app is growing in popularity among bargain hunters, businesses are becoming increasingly attracted to the cheap and effective direct-to-consumer advertising that the app provides.

The Walrus Saloon in Boulder started using DuckDuck shortly before the app launched in April. Saloon manager Petey Helm praises DuckDuck for its visibility, versatility, and ease.

“DuckDuck has given us the opportunity to get involved with a marketing stream that we would not have had the ability to get into otherwise,” Helm said. “It allows us to be seen by potential customers that are a part of the mobile app world.”

The Boulder-based company was created by Chris Vincent and Andrea Pawliczek, who met while earning MBAs at Duke University. The foundation of the app’s business model is a mutual benefit for merchants and their customers.

“We offer a digital platform for the small business to access a mobile marketplace,” Vincent said. “We come to business owners with a turnkey system and user base ready to run whatever they want.”

To develop a sense of how local businesses conducted their marketing, Vincent went from door to door in Boulder, talking with owners. Meeting with about 30 merchants, Vincent said he was able develop an understanding of their digital marketing and advertising needs.

“I was able to get a sense of their ability, or inability, to actually reach their target demographic,” Vincent said. “Then I asked them about the product that we had in mind, so a lot of the app was actually born from the merchants telling us what they wanted.”

What the businesses wanted was an effective and affordable means to communicate with their customers. Vincent and Pawliczek delivered in the form of an application that ranks bargains based on the customers’ proximity to the business.

“There are restaurants running specials, but without DuckDuck, you wouldn’t know unless you saw their sandwich boards or individual marketing,” Vincent said. “Now you can see that, within two blocks, there are eight deals going on right now.”

Push notifications

These push notifications, proposed by the business, are published between four and 21 times per month. Depending on the subscription level, the app can cost the business anywhere from $49 to $349 per month.

For that fee, merchants are buying the opportunity to publish a bargain tailored for their needs. By including a countdown clock on each deal, businesses are able to drive traffic during slow periods, while not disrupting organic traffic at busy times.

“DuckDuck has allowed us to change the way we run specials and how we get the word out to customers,” Helm said. “It is such a real-time process that we now have the ability to run specials or deals spur the moment.”

About 35 percent of participating businesses log in to their account and launch a deal when they see fit. The other 65 percent elect to participate in the Autopilot Program, where their deals are managed entirely by DuckDuck.

“If we notice the merchants haven’t been running deals, we’ll ask them what they want to do and when they want to do it,” Vincent said. “Then we’ll offer to take over.”

In addition to the smart phone app, Vincent said a significant amount of traffic is driven by the DuckDuck Deal website, Twitter feed and Facebook page as well as e-mails.

“The Daily Deal e-mail is where we pull out one of the best deals that’s going on that day,” Vincent said. “Unlike a Groupon, though, we don’t make you buy it when you see it; we just let you know that it’s happening.”

As DuckDuck has grown in popularity, users are doing more than just finding a bargain burger. Some are planning entire nights using the service.

“We’ve found this happening particularly in the college market,” Vincent said. “A small group of women at CU told me that they recently used the app to choose bars for that evening based on deals from DuckDuck.”

Data collection

DuckDuck Deal also collects market data that it shares with the merchants, free of charge. By helping businesses to generate and analyze data, Vincent said DuckDuck is saving them hundreds, if not thousands, of dollars over conventional advertising.

“We believe that it is effectively their data and they can use it to optimize their market,” Vincent said. “From our perspective, the business will then want to use the app more, so it works out for both parties.”

While the app is still relatively young, future plans are already in the works. Vincent said an incentive program that rewards end users with points if they share deals with their friends is in development.

“If the end users capture a deal, use a deal, or push deals to their friends over Facebook or Twitter, they will collect points,” Vincent said. “Those points will lead to gift certificates to our partners or prizes.”

To partner with new merchants and attract a wider user base, expansion into midwest college towns is DuckDuck Deal’s next move.

“Our best strategy is to stay where the young people are,” Vincent said. “We have been able to establish really positive relationships with independent businesses in college towns because we understand them and they understand what our product can do.”

BOULDER – Everyone knows there’s no such thing as a free lunch. But what about one that’s deeply discounted only for certain people in a certain area? About 180 businesses throughout Boulder and Fort Collins are trying the concept out with DuckDuck Deal.

This smartphone app, available for iPhone and Android operating systems, uses the phone’s GPS capabilities to find time-sensitive dining deals at nearby eateries.

While the app is growing in popularity among bargain hunters, businesses are becoming increasingly attracted to the cheap and effective direct-to-consumer advertising that the app provides.

The Walrus Saloon in Boulder…

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