How 3 people without investment “magic button” for stores did
What came before this?
There are no direct links to our product or even screenshots of it in the article. Yes, I'm still scared of UFOs.
A little over a year ago, I talked about the application of the gaming approach in e-commerce , and in January I showed what this idea turned into and how we fed it into Canadian incubators . We did not get into the incubator, although we got to the very end. We could join any incubator in Ukraine, but their conditions seemed to us not very attractive. So, we just worked a lot during these 9 months, and during this time no new materials on “gamification” in online trading have appeared on the hub, except, besides this material , it has been for some reason vehemently publicized.
A new beginning
After checking the idea of a game approach to pricing in a store with random prices and receiving feedback from sellers and customers, we analyzed the behavior of buyers and decided to create a mass product for any online seller. This solution was supposed to be inexpensive, effective, easy to use and beautiful. Like a “make it beautiful” button, but for sellers.
We decided to move away from the idea of “random prices,” since people could not clearly understand how this works and a similar formulation scared them off. Now we offer you to win a random discount for free. The idea was to keep the customer unsatisfied with the price of the goods, offering him to win a discount. This increases conversion. It was decided to limit the number of attempts to get a new price / discount and offer to get more attempts for “Likes” and “Sheyrs” on social networks. If a visitor has issued a coupon, this is already a lead for the store, which can be turned into a buyer even if he does not use this coupon. We also decided that it would be cool to offer users who have taken a coupon to use it immediately by filling out a quick order form. For such orders using the coupon, we planned to take a commission of about 3%. Besides, It was planned to monetize the project through paid promotion services and its platform of discount offers, like the boring Groupon, but with random discounts and a commission 10 times lower. In the end, everything turned out quite differently.
After the test store was closed, we already wrote the logic for generating prices, a database, importing goods, collecting statistics, configured servers on DigitalOcean, and quite a lot more. And then PHP + MySQL was enough, and now it is enough. Later we will take out some of the functions on node.js and nginx. Everything was originally built on services, so that later it would be possible to distribute the functions to different servers (admin panel - your server, button / clicks - your server, mail - your server, directory - your server), and suitable ready-made ones were taken to reduce development time solutions. For example, PHP-Daemon was used to track the queue of letters (and other tasks) . We write the letter to the database, he finds it and sends it through Mandrill.
But, we did not have a beautiful design. The design of everything: the widget itself, the presentation of the project for investors, the landing page. In total, 5 people took turns working on this problem for 3 months. The presentation even hung a day in the Trending in Social Media section on the main SlideShare, and one of the venture capital funds paid special attention to the project because of it.
Contractors and employees violated deadlines 4 times. During this time, I managed to work in a startup incubator for a couple of months, refuse several offers on pre-seed investments and apply for free participation in all relevant conferences. Our STO, meanwhile, wrote a RESTful API (Luracast Restler), screwed on localization and implemented a basic admin panel for partner stores (Laravel).
We started connecting stores and solving a whole bunch of problems for them:
- We increase conversion by keeping customers who need discount
- We generate leads (leads of potential customers) as soon as someone receives a coupon
- We make sales as soon as the coupon is used.
- We increase the partner's fan base and the number of mentions on social networks
- We improve the interactivity of the partner’s site and raise it in the search results
- We create an informational and advertising occasion.
We worked and worked, and even implemented the integration of the service in offline stores through a QR code or a short link to the price tag of a product, when clicked, the mobile browser opened the game with this product from this seller so that the client could win a discount and buy the product right on the spot by telling friends about him on Facebook and Twitter along the way.
But, as it turned out, this was not enough to take 3% of the commission from each transaction. We still had the option of monetization through our own site, because for some sites 3% is a penny, compared with any competing solution. There were also additional paid services, such as the inclusion of a partner’s offers in an email newsletter or data collection and sale. Doubts came to an end when the spouse of our service station and part-time bizdev in a large advertising company showed us the specific mechanics of monetization through the very anonymous data about customer preferences. But, for this data there should be VERY much, so one more was added to our advantages:
- We do it all for FREE
Button distribution and current status
Now we were sure that we would connect thousands of stores in the first six months! After all, we are cool and free! But no. There are dozens of interested stores, but inserting just two lines of code into your website and submitting a list of promotional items (or linking to the yandex market feed) turned out to be too difficult for so many. Probably every SaaS came across this. The problem of integration. Maybe customers just want us to hack their site and set everything up ourselves? I dont know.
But then we were lucky. We became the semi-finalists of their Founder Games and got free admissions and a demo start-up table at the Webit Congress in Istanbul. It wasn’t as cool as their website described, but we decided not to go to a party with FTV girls,
Now we are preparing to participate in IDCEE 2014 (free of charge, as selected at the startup competition) and are negotiating with partners and investors. We have to find $ 500K of investments, hire 15 people and build a new global discount service with an unusual method of monetization in six months or a year.