Success: Discounts delivered over the phone

By Christine Nikiel

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Smartphone entrepreneur wins Hi-Tech award, and attracts some big-name customers.

Scott Bradley sees the cellphone as a powerful marketing tool. Photo / Paul Estcourt
Scott Bradley sees the cellphone as a powerful marketing tool. Photo / Paul Estcourt

The mobile phone - it's one of the first things we turn to in the morning, and one of the last things we check at night.

And, according to research house Morgan Stanley, 91 per cent of us keep our phones less than 1m away at all times.

Those statistics, says entrepreneur Scott Bradley, make the device a hugely powerful marketing tool.

Bradley's startup company, VoucherMob, has developed a free application for smartphones - an iPhone or Android - which sends location-based discount vouchers directly to consumers' phones.

If you're out shopping with the kids and they're screaming for something to eat, VoucherMob will alert you to special deals offered by participating retailers wherever you are, explains the former marketing and advertising executive turned tech entrepreneur.

You'll be sent the promotion details, the retailer's contact information, and a map showing the retailer's location and your distance from it.

"Consumers want to interact with large brands and the idea of being able to get access to deals from my phone relative to my location made natural sense. And if you ever start with a business idea that just makes sense, then you're off to a good start," says Bradley.

The company won the Ministry of Science & Innovation Best Hi-Tech Start-up category in last week's Hi-Tech Awards in Wellington. After launching in March with a two-week radio campaign, Bradley has signed up 100 local retailers, including Dick Smith, Liquor King, McDonald's, Civic Video and Pumpkin Patch. In March alone, the application had more than 1000 downloads from Apple's App Store.

Having "big name" retailers on board is the difference between VoucherMob and the proliferation of one-day sale websites, says Bradley.

However, the large number of those sites has "conditioned" Kiwi consumers to hunting for good deals, he says.

Retailers who sign up get access to a secure online interface that lets them create and manage their own promotions. The system is real-time, so when a retailer updates a promotion it is also updated on the smartphone.

Retailers' reactions have been mixed, says Bradley. "Some struggle to put us in a box as a media solution. [Are we] delivering an audience only, or are we a sales channel delivering sales? We work with them to understand their metrics for success.

"We've had to be more fluid in our commercial model than first anticipated. Educating retailers is challenging, and it's going to take time."

A former marketing and advertising executive for TVNZ, and Modem Media in Britain, Bradley co-founded online energy broker Utilyx in London in 2001, just before the dotcom bubble burst.

The fledgling company had raised £5 million ($10.3 million) but, "no one realised the bubble wouldn't inflate again. We continued to spend that money but ran out pretty quickly".

After having to shed staff and make cutbacks, Utilyx is still trading, with 80 staff, and manages energy for clients including Vodafone, Tesco and Astra Zeneca.

Bradley is still one of the company's largest shareholders.

On returning home after 10 years in London, he bought into Auckland digital agency Born Digital, which builds applications for a range of clients. He'd seen the mobile voucher model working successfully in Britain, where Vouchercloud had 5000 national retailers on board and a million downloads in the first year. Bradley reckoned New Zealand was ripe for the idea.

As mobile technology evolves, so do Bradley's ideas. Next on the list is to make the phone a digital wallet: VoucherMob's technology already allows for the inclusion of a barcode that can be scanned by the retailer. The digital wallet will help build "stickiness" with the consumer, he says.

He's also keen to scale up as quickly as possible. "The reality is, you can't protect the technology so it's all about evolution. You've just got to move faster than the competition."

Investment will help, and Bradley has signed an exclusive negotiation contract with one of four interested media companies, and an investment house in Australia.

The company employs five permanent marketing and sales staff, but relies on outsourcing of other tasks to keep costs down. Software development is split evenly between Indonesia and New Zealand.

After the tough times at Utilyx, he's learned to manage growth and keeps tight control of the purse strings - within reason.

"We make sure that we are really conscious of our costs and measure every investment we make. But we also celebrate our wins. On an okay week we have a few beers, on a good week I shout the guys some squid and if we've done really well they'll get a bottle of champagne - just not the most expensive kind."

This story has been changed from an earlier version that said VoucherMob's application could be used on Blackberries, Androids and iPhones.

VoucherMob uses a different application for Blackberries than iPhones and Androids.

- NZ Herald

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