VoucherCloud is a new iPhone app which provides discount codes for mobile users, the first mobile app to offer such a service.
The app was developed by Bristol-based company Invitation Digital. I've been talking to Director Greg Le Tocq about the new app...
Why did you decide to launch Voucher Cloud?
We produce an annual discount voucher print product, the Invitation Book, which has grown over six years into nine editions across 15 regional centres with over 150,000 sales.
However the constraints of print and the geographical restrictions of our product instigated a strategic move into digital. The iPhone in particular, and smartphones in general, was the next logical step. We wanted to create the eBay for offers but also to create an application which delivered value to the customer. There were mainly gimmicky apps out there at the time and lots of games but nothing which actually saved the user money.
What was your background before launching this app? What else has Invitation Digital been involved with?
I personally worked in advertising in London for two years, desperate to get into a top ten agency. I then got offered a contract with one of the big companies and the day before I was due to start I broke my leg and ended up coming back to Bristol.
With the help of The Princes Trust, I then started my first business, which was an upmarket privilege card and discount website and, within 18 months, I had joined the people from Invitation who were also operating an incentive marketing company in Bristol.
For me, this was the logical next step in my entrepreneurial journey and I now am sat alongside some exceedingly talented and successful local entrepreneurs. Digital also have a great restaurant social media web site eatout.co.uk
Have you taken any funding for the app?
No, we have funded the business ourselves. We have a passionate group of shareholders who have a shared vision. We have invited three other investors to the table, who bring something extra to the business and we are now looking at funding options to rapidly scale the business.
How will it make money?
The question everyone asks me! As a group of people, we have learnt that trying to charge people from day one just does not work so our desire is to build up the user base and build up our brand relationships.
We will then look at the Sky model, whereby you have the VoucherCloud app for free but if you want the really hot, exclusive offers, we will ask you to share your savings with us. We will also be looking at advertising and allowing merchants to get added exposure in the app and newsletter. We also have a few other exciting tricks up our sleeves!
How many downloads have you had so far? What kind of marketing have you done?
The response has been phenomenal and in the first fortnight, we received over 150,000 downloads. We reached number one in the lifestyle chart and have been present in the top 25 free apps since day one.
Remarkably, we have done no marketing at all! We have had a couple of great pieces of PR and have spread the word through Twitter and Facebook.
We also received a featured listing from Apple which helped us. We are now averaging between 10,000-15,000 downloads a day and we are now looking at ramping things up by looking at Admob and a few other opportunities which exist in the marketplace. Positive word of mouth is the key though.
Was it difficult to convince brands to get on board?
Convincing any new brand to use new technology is always going to be difficult. However, the reaction from the brands was amazing and extremely positive. We had spent a lot of time second guessing and solving their likely technical and logistical issues and that proved extremely fruitful. Most of the big brands have been very supportive of us. Coffee Republic, for example, gave every member a free coffee! Others will wait and see.
Content farming is one of the hardest things anyone will ever do, and the amount of content we have will make it very difficult for anyone to compete with us. We currently have over 10,000 branches accepting offers and we are adding about 50 offers a day which are a mixture of local and national brands. Having the reputation of the Invitation Book has certainly helped us.
What are the key benefits of voucher codes for retailers?
Incentive marketing is a key part to retailer’s strategy at the moment and voucher codes are a convenient and cost effective way of driving schemes. What is exciting about mobile vouchers is that your mobile is always with you and can assist in impulse shopping.
If you are out and about and looking for a coffee or a bite to eat, a voucher can sometimes be the deciding factor in where you eat.
Vouchers have proved to be very popular online, so is mobile the next natural step for vouchers?
It is important that we differentiate between voucher codes online and mobile vouchers. Using the VoucherCloud application, you can browse voucher codes for online shopping, have them delivered at a press of a button to your email and then go and shop online.
We are looking into implementing online shopping through our app but the main advantage of VoucherCloud is that it removes the need for paper vouchers and also helps to save the high street.
I cannot remember the amount of times that I have forgotten a paper voucher - this now will never happen again. Juniper research predicts that by 2012 over 13bn mobile vouchers will have been redeemed worldwide, and we are at the forefront of this technology.
What are the challenges in creating this kind of service on mobile?
The redemption system and the content. We have spent a year developing a system which allows any merchant, whether it be Billy’s Bike Shop or a national brand, to log on to our website, create their own dashboard and then upload their offer direct to the phone.
They can have complete control over the number of redemptions, the number of usages per person, and of course the offer period. All we ask for is an attractive offer for our users. We have no doubt that people will try and replicate our service but for anyone to do this on the scale of content we have achieved, will take an army!
You have received mixed App Store reviews, perhaps due to confusion around the subscription charge: how have you addressed this?
There is a part of me which suspects a lot of competitor activity with some of the negative reviews – the pattern and nature of the comments make that clear.
However, we do have to hold our hands up and admit mistakes in clearly communicating our proposition. We created some confusion over subscriptions where people thought you had to pay to use the app, which is not the case. VoucherCloud is a free app with hundreds of free vouchers that users can enjoy without paying a bean.
That will always remain the case. However, there are a small selection of premium offers with high value savings which we ask a small fee for in order that we can then continue to obtain more exclusive, high-value offers. Payment for these is entirely optional. We also had people saying we sold user data and spammed users. This too is categorically untrue.
Competitors will always look for a weakness and the negative reviews count for a tiny tiny percentage of our users. Mixed reviews were inevitable with competing apps on the app store.
However, we have taken all reviews as constructive criticism and we have quickly released a new version of the app to solve any problems, and have had great support from Apple in doing so.
How do you distinguish VoucherCloud from other services in what seems to be a crowded market?
VoucherCloud is a mobile app which delivers mobile vouchers and eradicates the need for printable vouchers. Currently, there is nobody else doing this on the scale that we are. There are some apps out there which are concentrating on London and some others which are aggregating content already out there in the marketplace but we have gone out and negotiated every single deal.
We also have printable vouchers on our website and all of these are geo-located so that you can simply type in your postcode and it will tell you the nearest vouchers to you. Regarding voucher codes, this is indeed a crowded market place but by using the mobile application to breach the gap between online and offline, we believe that we will become a player in this marketplace as well.
What are your future plans? Will you be creating apps or mobile sites for other handsets?
We are of course already developing on other smartphones and in other geographic markets worldwide. We also are going to look at other apps which concentrate on particular sectors, narrow and deep.
We are also looking at improving the web experience and exploring a couple of other opportunities which have come our way. At the meantime however our core desire is to firmly establish VoucherCloud as a brand and to reach the target of 1m downloads as quickly as possible.