Group buying sites such as Groupon have proven to be a lucrative model for social e-commerce. Today, ChompOn is launching at TechCrunch Disrupt to bring a white-label group buying service to the space, allowing business owners to create their own deal of the day.
ChompOn’s platform allows businesses to easily create a deal of the day (which is hosted on ChompOn), and set limits on the discount, how many people can access the sale and how long the sale is available for. The business can send the deal out via a link on Twitter, over email, and on Facebook. ChompOn also aims to help businesses create repeat customers by offering extra discounts for users who Fan their Facebook page, share the deal on Twitter or write a Yelp review.
The virtue of ChompOn is that it allows businesses to create more targeted promotions. Sam Yam, co-founder of ChompOn and founder of AdWhirl (which was sold to AdMob last year), says that the site also doesn’t take as big of a cut from the sales as Groupon and LivingSocial do. Yam declined to name the exact cut ChompOn takes, but says that it “falls well below the 30 to 50 percent mark.”
Additionally, ChompOn provides businesses with analytics from deals, letting them see their performance relative to other businesses in their area and even sector (though the businesses are anonymous due to privacy issues).
The one advantage to using Groupon and other popular deal of the say sites is that they have an established userbase of millions of subscribers that businesses can tap into. ChompOn, on the other hand, requires the business to tap into their own database of users. That being said, many businesses may see value in both conducting their own sales and participating in sites like Groupon.
Q&A
RS: Why haven’t you thought about making this bigger?
SY: We do Spas, restaurants, we may go beyond that. We want to reach out to communities like campuses. I think in terms of specific services, our platform is open and we will keep adding more actions.
JH: I’m confused as to how you connect businesses with consumers?
SY: Typically a restaurant would never reach out to their own consumer base, but this is about rewarding your own customers. For us the focus is getting businesses to reach out to their own customers. A Business may have their own email list. But we are collecting our own mailing list as well.
KG: Small businesses are completely overwhelmed with social media tools. How do you answer that frustration?
SY: Businesses are getting killed on the rates that Groupon charges so they are receptive.
JC: I’m an investor on TwonHog. We run promotions for SFGate, so we can use their userbase.
SY: We are targeting the long tail.