Groupon and its many imitators have been facing a rising tide of negative publicity over the past few weeks, the gist of which is that Groupons are terrible for small businesses.
The stories are all pretty much the same: business owners sign up for a deal that would lose them money in the hopes of upselling and bringing customers back for full price purchasers. Instead, they find themselves overwhelmed by swarms of rude bargain hunters who crowd out full-price customers, refuse to spend anything beyond the face value of the coupon, and are never seen again.
http://articles.businessinsider.com/2010-10-05/tech/30013393_1_groupon-businesses-sustainabilityBusinesses seek loyal customers, but from the looks of it, they're not able to convert new patrons into repeat buyers once they use their Groupons. Perhaps, a better business model to attract customers needs developed.
Until a better name is derived, I'll refer to this idea as Foursquare on Rails, or
FoR for short
(apologies if FoR is a bad analogy for what I'm proposing).
The following example is how it could work:
A newly opened restaurant--Ombra--wants to attract a loyal customer base, but doesn't want to go the route of Groupon and its ilk. Enter Bitcoin and the yet-to-be-developed-APP
FoR. Firstly, Ombra's must accept Bitcoin to enjoy all its benefits, some of which yet to be named and, let alone, developed. A Bitcoiner dines at the restaurant for the first time and pays full price for their meal with Bitcoin via a smart phone. A little code (boy, I hope codes are little) is activated, allowing the Bitcoiner a one percent discount off their next visit's tab. This percentage is doubled if they bring a guest(s) and is rung up as one tab. This offer is only available for one week, whereupon once the week is over, the Bitcoiner must pay full price again and restart the whole procedure. But this is only true for the first week.
You see, each time the Bitcoiner returns to Ombra's, they're rewarded with an additional 1% discount, up to a max of 10% (20% with guest(s)). If on his 4th visit a Bitcoiner pays for his meal with Bitcoin, he's now at the 4% (maybe it's 5% now, I'm getting confused) discount level, but if for some reason he failed to dine at Ombra's within a week's period, he forfeits 1%. Each week, he loses 1%, then after 4 weeks, he'll have to start all over again, but if he restarts his visits, say he's at the 3% level, the added 1% discount starts there.
Once at the 10% level (with a 20 visit minimum), a Bitcoiner can use this discount in conjunction with any other discounts that other patrons are able to enjoy: coupons (but not Groupons, which the restaurants won't have anyway), senior citizen discounts, etc.
After 10 visits within any time frame, a Bitcoiner will always maintain a 5% discount and can easily regain his 10% status after 5 more visits which, of course, can be accomplished in 5 days opposed to 5 weeks. This fact is indicative of a first time user of
FoR. After 10 visits in 10 days, a Bitcoiner will be at the 10% level.
Now we have loyal customers being awarded for their visits, opposed to attracting new customers with a 50% discount that most of the time never return. As a restaurant owner, which would you rather have?
What's great about this idea is that more women are probably prone to take up these offers using their smart phones than men.
Thoughts?
~Bruno~
(not the Bruno Manser Fund)
