These days, businesses are striving for ways to get their name out into your social circles. TalktUp, a startup out of Bellevue, is looking to help with a platform that empowers businesses to reward customers with cash discounts.
This space is heating up lately as companies see the power behind word-of-mouth advertising increase exponentially with tools like Twitter and Facebook. Companies such as Fab and Groupon have seen great results from customer acquisition methods that reward current customers for inviting their friends (a tactic that is quite popular in the daily deal space). Refer.ly, a Mountain View company started by former Seattleite Danielle Morill, is also looking to capitalize on this using referral links in the digital realm.
TalktUp offers the ability for businesses to acquire new customers that are open to buying products at full price. Many people are worried about the viability of the daily deals space in creating quality life long customers. Although a 60 percent markdown will bring in many new customers, will those customers stick around and be loyal to your brand even when the prices are full? TalktUp negates this by bringing in customers that are willing to pay full price based off a recommendation from a close friend.
We chatted with two of the co-founders Saif Hakim and Aaron Goodin to find out more about the strategy in this installment of Startup Spotlight:
Explain what you do so our parents can understand it: “We are a better way for businesses to gain and retain customers. TalktUp motivates and incentivizes customers to spread the word about your business.”
Inspiration hit us when: “Watching the rise of the daily deal scourge. We realized that businesses were losing money to bring in one-time bargain shoppers and paying a ridiculous cost to reward coupon cutters. We saw an opportunity to help small businesses. Instead of losing money giving away huge discounts to strangers, why not spend money motivating the loyal customers you have to leverage their networks and bring in new customers? We set out to provide a measurable and effective way to motivate customers and track progress. We allow businesses to build a stronger bond with their existing customers, and bring in new customers willing to pay full price for their product based on a friend’s referral, instead of a 50 percent off coupon from a third party site.”
VC, Angel or Bootstrap: “Bootstrap. We are very committed to our mission: To build community by establishing strong relationships between businesses and consumers. We wanted to make sure we stuck to this vision and mission throughout the development process and not get sidetracked by bringing in investors who didn’t necessarily share that vision. Now that we are launched, we feel confident asking other people to invest in what is now a business, not just an idea, and are actively and selectively seeking investment partners.”
Our ‘secret sauce’ is:”Our secret sauce is incentivizing, tracking and rewarding word of mouth referrals for offline retail business purchases. The big idea behind talktUp is quite simple, actually. We all know that word of mouth is the most effective way to generate business. If you can track word or mouth, you can reward word of mouth. If you can reward word of mouth, you can motivate your customers to talk about your business. And with the now socially connected world, your customers’ reach is far greater than ever before. TalktUp can track people, publications, apps, coupons, most anything digital. And, unlike other social marketing apps, we close the loop on influencers in the cloud. We know when a referral results in an offline purchase at the register. So we are able to offer a pay-for-performance model to our business clients. This eliminates the need for businesses to spread around marketing dollars to reach one prospect. We focus the marketing dollars on the customers these businesses already have, motivating the customers to reach out to prospects they don’t. But behind the sauce are the guys in the kitchen, our team. We’ve been at this for over a year, and as with any startup, we have hit our bumps along the way. For most of the guys this is their first startup, working toward a vision fueled by passion and faith. Its not easy, but the adversity and tenacity this group has shown is inspiring. They have strong minds and open hearts, these guys just don’t quit.”
The smartest move we’ve made so far: “Opening up and talking about our idea. Startups are big on “stealth mode.” Reality is, you’re no Wile E. Coyote “Super Genius.” There are another 50 people out there working on your same idea right now. Open up and offer your idea for feedback and advise. No stone unturned. We started meeting almost everyone and anyone, gathering feedback about the product, the team, go to market, everything. Being humble, and agile, accepting feedback and being open to pivot is essential. Through feedback we made 2 major pivots key to distribution.”
The biggest mistake we’ve made so far: “Wolves in sheep’s clothing. Being foolish enough to think everyone is out to help you. Reality is, there are vultures out there preying on startups just like anything else, and we fell prey to a couple of these. And when you are in bootstrap mode, every hit is a big one to the pocket book. So we’ve been hardened a bit.”
Would you rather have Gates, Jobs, Zuckerberg or Bezos in your corner: “It would obviously be fantastic to have all of them or at least elements of each, but in our world we gravitate towards Jobs. He was huge on his “why.” Its not about what you do, its about why you do it. We are about building relationships and community. We started with little money and were able to recruit a great team, not because we are going to be the first to do something glamorous nor for the promise of big money. We put together a team by finding people aligned with our “why”. Because they believe what we are doing is right for the community and the economy. That’s what we did. We are big on our “why.”
Our world domination strategy starts when: “Soon, isn’t the end of the world this December? You’ll know when you start seeing orange talktUp bubbles in your sleep! But seriously, it starts the moment people realize that talktUp is changing the relationship they have with all the things they like. No longer will a business have to spend money hoping to bring in a fraction of the people that heard their message. We put the customer and merchant in business together and that partnership benefits everyone. Peripheral to that a newspaper or magazine publisher can be a part of this relationship as well by promoting businesses. Their current revenue model is broken and again, this changes how things are done.”
Rivals should fear us because: “We are truly committed to and passionate about our vision and will not compromise on it. Giving up is not an option for us because of this. It’s not about money for us, we truly want to break the mold. (See our secret sauce above.)”
We are truly unique because: “Never before has a business been setup that allows for the relationship between a business and a customer to financially benefit both sides. Combine that with a detailed metric of who is talking about you to other people as well as the ability to directly interact with a customer on a one to one or one to many basis and we feel that makes us incredibly unique.”
The biggest hurdle we’ve overcome is: “Money. Since we have bootstrapped this throughout it’s development and launch phase, the team has compromised a lot to make talktUp a reality.”
What’s the one piece of advice you’d give to other entrepreneurs just starting out: “Again talk to everyone, share your idea. All input is good input, be humble but don’t give sanction to the nay-sayers. Seek out those relationships that can educate you about what you are getting into and how to cut down on the number of mistakes you will inevitably make. Embrace those mistakes though and get up the very next morning moving past it. Work your butt off, there is only one person that will work harder toward your vision than you… your competition.”