A daily deal start-up headed toward a summer launch aims to combine online discounts with consumer reviews of local merchants. LocFree Network LLC could start offering deals via LocFree.com in New York City in early summer, says Timothy Peterson, company co-founder and chief marketing officer.
What will make this local deal provider different from competitors, he says, is the review requirement: Consumers who receive deals must provide e-mail addresses, and those consumers must review their merchant experiences after using the deals. “Say you get first entrée for free,” he explains. “Then you must write a review, negative or positive, for the LocFree site.”
LocFree will not allow consumers to take advantage of future deals until those consumers review merchants who offered the previous deals, he adds. Merchants can contact consumers via e-mail to offer other deals, too.
LocFree hopes to launch in New York City with at least 90 days worth of deals ready to go, he says. The deals will involve not only restaurants, but also museums, retailers—including, perhaps, local outlets of national chains—and entertainment providers. Offers might come to consumers via text messages, too. “We are looking at social,” Peterson says.
He says LocFree will occupy a relatively lonely space. “A lot of companies are in the review space and deal space,” he says, “but none really do both.”
Peterson will speak at the Internet Retailer Conference & Exhibition 2012 in Chicago in a session entitled “Attracting and retaining talent in a competitive market.”
Amazon will use a two-for-one gift card offer next week to get consumers to check out AmazonLocal, its daily deals service.
On Tuesday, March 20, Amazon will let consumers buy a $10 gift card for $5. The catch: They have to go to amazonlocal.com to redeem it. The card is good for any Amazon merchandise, though. The retailer is limiting buys to one per customer.
Mike George, vice president of AmazonLocal, says the promotion is the most high-profile yet for the service, which launched last June in Boise, Idaho. AmazonLocal is now in 90 locations in 26 states and Washington, D.C.
Though others, including Facebook, have backed out of the daily deals category after it seemed to cool off last year, George says Amazon is applying its experience in the online retail space to the segment. “Some of our customers have up to a 17-year relationship with us,” he says. “Our job is to make sure they can make really informed purchase decisions.”
AmazonLocal isn’t the retailer’s only competitor in daily deals. Amazon has a stake in LivingSocial, the number two player in the category, next to Groupon. Last year, Amazon lent its considerable heft to LivingSocial for a similar deal, offering a $20 Amazon gift card for $10. LivingSocial sold more than 1 million of the vouchers and greatly increased its visibility.
That offer came after Groupon partnered with Gap in August 2010 for a deal that offered $50 in merchandise for $25.