google presentation 2/5
TRANSCRIPT
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Scoutmob mobile advertising
Michael ForoobarFebruary 5, 2013 (Google)
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Agenda for today
» Background on Scoutmob– Unofficial history– Differentiation
» Local ad sales–Merchant math– Common objections (attribution)
» Experiments and mobile trends
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Scoutmob actually started out as a wi-fi business
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Local businesses receive a custom landing page
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Tool for SMBs to build customer relationships
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Quickly pivoted when a better business model came along
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“COST PER DOOR SWING”Our pitch: use mobile to drive offline sales
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SMB niche small but 12% CAGR w/ online capturing growth
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Offline still accounts for bulk of local advertising spend (deals are small)
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Needed to differentiate brand from competitors
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Needed to differentiate brand from competitors using mobile
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Needed to differentiate brand from competitors using price
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ROI math works for local businesses (even w/ high costs)
Redemptions 1,000Average ticket: $55 Average party size 2.4 based on survey dataCost of entrée $15 one per personCost of app/dessert $5 "Cost of drink $3 "
Avg Scoutmob ticket: $35 Percent discount 50%Max discount $20 capped downside
Variable costs: $28 Cost of sales 50% food and bev costs (35% standard)Scoutmob fee $4 per redemption
Gross profit $3,600 Total revenue $35,200Cost of sales -$27,600Scoutmob costs -$4,000
ROI 90%
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Marketing not always day-to-day top priority for SMBs
Redemptions 1,000Average ticket: $55 Average party size 2.4 based on survey dataCost of entrée $15 one per personCost of app/dessert $5 "Cost of drink $3 "
Avg Scoutmob ticket: $35 Percent discount 50%Max discount $20 capped downside
Variable costs: $28 Cost of sales 50% food and bev costs (35% standard)Scoutmob fee $4 per redemption
Gross profit $3,600 Total revenue $35,200Cost of sales -$27,600Scoutmob costs -$4,000
ROI 90%
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Common objection: I am giving discounts to my “regulars”
» Anecdotes hard to overcome
» What does “regular” mean?
» Average user dines out ~5 times per week– Primarily lunch and dinner– 5% dine out more than half their meals
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Solution: survey customers to baseline for incremental value
No, I was
alrea
dy a re
gular
custo
mer
No, I was
a custo
mer but o
nly infre
quently
Yes, b
ut I had
heard
about m
erchan
t prev
iously
Yes, I
learn
ed ab
out the m
erchan
t thro
ugh Sc
outmob
0%
5%
10%
15%
20%
25%
30%
35%
40%
11%
33%
27% 28%
Was this your first visit?
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Solution: survey customers to baseline for incremental value
No, I was
alrea
dy a re
gular
custo
mer
No, I was
a custo
mer but o
nly infre
quently
Yes, b
ut I had
heard
about m
erchan
t prev
iously
Yes, I
learn
ed ab
out the m
erchan
t thro
ugh Sc
outmob
0%
5%
10%
15%
20%
25%
30%
35%
40%
11%
33%
27% 28%
55% new and 11% self-described regulars
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Common objection: Scoutmob is sending me bad customers» More anecdotes– Repeat use (“friend’s phone”)– Bad tippers– Low-margin
» Data locked in POS– Also, lack of analytics expertise
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Solution: study POS data to understand spending (w/ Copilot)
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Solution: study POS data to understand spending (w/ Copilot)
Scoutmob customers actually spend more, up to max discount
Source: Pizza Nostra (San Francisco)
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Transactional data: ad platforms, banks, card companies, etc.
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MOBILE COMMERCE AND ATTRIBUTION THOUGHTS
Things we are seeing and planning
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Running experiments is a great way to understand contribution» Short-term online offline– Urgency and expiration work well– Small incentive, e.g. free hot dog
» Tests in retention and acquisitions – Email vs. push vs. email + push– Offline branded search, location
searches
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Accuracy more realistic than precision in multi-channel
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Mobile commerce big this year for us, what we are seeing…» Mobile desktop conversion» Mobile web is low hanging fruit– Tablets look like desktop– Challenge: product browsing– Drive traffic w/ email
» Logged-in users help– Shopping cart across devices–Mobile only promotions