One way that big data is being applied at the local level is via Card Linked Offers that track consumer spending and target offers and promotions based on that behavior.

Banks, credit card companies and payment processors have been especially targeted by the Card Linked Offer vendors, which include Cardlytics,  Cartera Commerce, edo Interactive and MasterCard’s TruAxis.  These financial institutions have long been accustomed to paying money to support credit card rewards programs. Now, however, they can use card linked offers to make money from commissions on sales, and also leverage their consumer data.

While initial results are apparently promising, the banks haven’t moved very quickly. Bank of America has spent an estimated $30-$50 million to launch Bank AmeriDeals with Cardlytics, but the banks generally are focused on compliance issues and are also focused on fees and traditional revenue streams, which are once again proving very lucrative for them. It is a far cry from the situation just three years ago, when the mortgage crisis and recession caused them to be looking more seriously at entrepreneurial opportunities.

The changed environment, in part, has caused the Card Linked Offer vendors to supplement their relationships with the financial institutions. Edo Interactive, for instance, has been developing  edo Marketplace to allow smaller merchants to use its platform to create Do It Yourself deals.

While it may look like edo is looking beyond banks,  edo President and CEO Ed Braswell tells us the company’s expanded Marketplace actually complements the company’s partnerships with banks. edo works with its bank partners to develop offers and target the right consumers. Edo’s focus is on getting relevant, “high quality”  offers, says Braswell. Edo is positioned to construct “Intelligent deals” based on “tons of data” from financial institution partners. The algorithms “really drive performance.”

To ramp up, the company has hired 23 local sales people, along with 12 sales people who are focused on touching the Top 700 national brands, adds Braswell. He also notes that there are “a few” sales people who are working on channel partnerships to help scale the merchant network.

The results that edo reports are impressive: 80 percent of those redeeming offers are new customers, and fifty percent of those return at least once within 90 days.

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Ads aren’t just valued for bringing in calls and walk ins. Local businesses increasingly place value on consumers looking up maps and directions, or participating in loyalty efforts, notes SuperMedia Director of Mobile Development Chris Folmer, who was speaking on a panel at The Local Search Association conference April 16 in Las Vegas. “There are lots of ways to drive true value,” he says.

Loyalty programs represent a real growth opportunity. Consumers are already engaged with the client. They need to maintain the relationship,” says Folmer. He notes that SuperMedia is rolling out a number of new loyalty programs. The programs are great acquisition tools. They are “really good to talk to new clients about. They really like it.”

The traditional backbone of loyalty programs have been text messaging, he adds. Texts really deliver results, and are “exploding” for SMBs. The key is to “get people to want to engage in content.” But they can also be tricky because they are so easy to unsubscribe from. “It only takes one bad offer for someone to opt out,” he notes.

Speaking on the same panel, Placecast SVP Blair Swedeen also emphasized strong results from text-based programs. Promotions sent out when consumers are near a store result in a 2.5 x boost in frequency, and a 22 percent purchase rate. There is also a 5 percent increase in average order value, he notes.

Increased smartphone penetration has greatly expanded the universe for smart offers, says Swedeen — smartphone users will also get push offers on their Apps and emails. “Most customers want delivery across all channels,” he says.

Edo Interactive VP Jeff Fagel says that texts in fact have already been surpassed by smartphone emails. Apps are also proving to be very effective. Merchants that have a promotion on a mobile app are seeing a 20 percent boost in their response rate.

Redemption rates are also soaring. A program that Edo ran with Subway, for instance, achieved a 15 percent redemption rate across the board. It drove the value of purchases up 30 percent. Moreover, 40 percent of those customers who redeemed offers came back at least once or twice in the next 90 days.

The key is driving “the right offer to the right customer,” and keeping it simple, adds Fagel. “There is nothing as impactful as ‘thumbs in faces,'” he says, noting that mobile offers will see 10-15x redemption rates of traditional coupons.

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Loyalty sales (including analytics) are typically associated with large brands such as Hilton and United Airlines. But a number of companies have been also trying to crack the code on SMBs, where the volume is.

This week, Edo Interactive announces it is doubling down on its SMB loyalty efforts, going far beyond what it has previously done since launching in late 2010. The 90+ person company, which has raised a total of $54 Million, has nearly doubled in size since it began building up its Nashville office to head up the SMB initiative, which it is calling “Edo Marketplace.”

Marketplace will have a broad rollout in 2Q, after testing in Chicago and Nashville with 200 local and national partners for the past month. Notably, Edo is moving away from its sole dependence on financial institutions for sales. (It currently works with 140 financial institutions.)

One outside sales partnership is already in place with 2GoMedia. Several additional sales partnerships are in development. The SMB marketplace suffers from “a lot of irrelevancy,” says VP of Marketing & Brand Development Jeff Fagel. “Local campaigns lack data.“

Edo hopes to provide its SMB customers with pay for performance marketing, and a better ability to “find customers, convert and measure” via real time reports that include impressions via Web page views, email, Texts, redemption texts and email. “We want to be able to answer the question: “What does $1,000 buy me?” asks Fagel. “Customers don’t want to pay for 1,000 Facebook likes.”

Edo, of course, is entering into direct competition against a wide range of players that have loyalty and offer components. We have counted more than 18 companies that are vying for this market segment in one form or another.

The post Edo Interactive Directly Targeting SMBs for Loyalty Services appeared first on BIA/Kelsey - Local Media Watch.

A big milestone was reached last week when Bank of America launched its BankAmericaDeals loyalty and rewards product to many of its 59 million customers. The launch of the product, a partnership with Cardlytics, suggests a coming of age for the new card-linked loyalty space. Indeed, more than 20 card-linked companies are vying to take deals and other marketing to the next level by taking credit or debit card information and producing ongoing, targeted ads and offers.

The companies ostensibly give an “in” to banks and other financial institutions, who otherwise might have been left behind in the emerging ewallet environment. Among the leading loyalty companies partnering directly with banks are Cardlytics, Cartera Commerce, Edo Interactive and FreeMonee Network. Bank relationships are also being pursued by Linkable Network and TruAxis. Each provides merchant offers and technology platforms, including merchant analytics.

It is hard to say who is leading — or even best positioned among these companies — leadership metrics might include the number of merchant accounts, average spend, conversion rates and reward participation. Several companies claim leadership based on different criteria. But Cardlytics has raised the most money among the players — $58 Million — and Bank of America, of course, is a major prize (but so is JP Morgan Chase, which has partnered with Cartera).

In a new report for BIA/Kelsey’s Marketplaces clients, we spell out additional details on Cardlytics and the card- linked space. The big questions are whether card-linked companies like Cardlytics, Cartera, Edo and others will use the ability to scale faster to bring new lines of success to their bank partners and whether they can be nimble enough to beat out vertically integrated players such as Google, eBay, Facebook, Amazon, Groupon and Living Social; and independent alternative payment services such as Square, LevelUp and Swipely. All in all, it is an intense, complex space that goes well beyond the simple daily deals environment that burst out just four years ago.

Leading execs from Cartera, Edo, Belly, Groupon and Local Offer Network will be speaking at BIA/Kelsey’s SMB Digital Marketing event Sept. 17-19 in Chicago. Sign up here.

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