Ox&Pen

Many loyalty programs (including Ox&Pen Version 1.0) award points for check-ins at shops and restaurants—check-ins that don’t necessarily translate into revenue for the merchant.

Presumably it’s great if a loyalty app shows a shop owner that 89 people checked in at their establishment last week, but what is the value of each of those check-ins? Did each person who checked in spend $5 or $50, or $0? How does the average ticket of the “check-ins” compare to the amount the average customer spends? By rewarding check-ins with points that are redeemable for rewards, the shop owner is paying for each check-in, so the resulting revenue is of critical importance.

Is it possible to reward customer behaviors that bring in revenue for the merchant? Below are three actions that business owners value. At Ox&Pen, we’re working to redefine loyalty to include each of these metrics, which when coupled with a customer check-in, prove to be  more deserving of rewards than check-ins alone.

Ticket Spend
Arguably the most obvious desire of a small business owner is for customers to make purchases. Rewarding customers for every dollar they spend is something credit card companies have been doing for years; through strategic reward initiatives, it could be the norm for small business loyalty programs.

By offering rewards for shopping and dining at certain shops and restaurants, loyalty programs can influence consumers to do more spending at small, local merchants, which is a step in the right direction to competing with larger-than-life corporate chains.

Customers sharing experiences with the merchant through social channels
Even if a customer doesn’t spend copious amounts of cash with each visit, he or she may be broadcasting the merchant’s name to hundreds or even thousands of friends and followers on Facebook and Twitter, which could end up being just as valuable for a small business as money spent.

Word of mouth marketing has long been a favorite buzzword of marketers; Nielsen reports that 92% of consumers trust recommendations from people they know, while only 37% trust search engine ads and 24% trust online banner ads (Zuberance). In terms of creating brand awareness, channeling resources to get people to talk about a brand seems to lead to a higher ROI than a big media buy.

Social loyalty programs, in particular, are in the unique position to incite a word of mouth movement. By rewarding people for sharing merchant experiences on social networks, business owners are investing in the type of exposure that has been proven to spur visits and spending from a new, expanded pool of customers.

Customers returning to spend more money
The only thing better than a customer spending money at a small business, is a customer returning again and again to spend even more money (slaps forehead). This is, of course, consumer loyalty in its truest form, and something that can be achieved with the help of a strategically employed loyalty program.

Loyalty is changing
No, running a successful small business can’t be drilled down to three generalized items. Rather, I’m inviting interested parties to take a look at the changing game of loyalty. How can loyalty programs reward customers for their actions that matter most to the merchant’s bottom line?

Since inception, Ox&Pen has sought to bring real value to local businesses by focusing on increasing the consumer behaviors that they value most, like dollars spent and social shares. After working with Chicago’s local, independently-owned merchants for a year, we have learned so much about what they need from a loyalty program. At the end of the day, they need more customers spending more money.

Continue reading “What actions are small businesses rewarding when…” »

This Sunday is the start of what is, for many, the reason March exists. Hint: it’s not a holiday that revolves around green.

It’s March Madness!

There are plenty of places in Chicago you can go to cheer on your alma mater or favorite NCAA team, but which ones will reward you for every dollar you spend on pitchers and pizza and burgers and wings?

Here’s the skinny on the bars that support some of your favorite teams, and will also give you Ox&Pen points—points that you can redeem for rewards at any merchant in the network.

Lotties Pub
Although Lotties, a Bucktown favorite, has been busy beefing up its on-screen resume as the feature bar in NBC’s Chicago Fire, they are ready for March Madness. And per usual, they’re ready for the swells of fans coming in to watch two teams in particular:

Kansas University
Owned & operated by two KU alumni, Mark Domitrovich and Dan McCarthy, Lotties definitely understands the nostalgia of the Crimson & Blue. Plus, it’s the “Official Chicago Bar of the KU Alumni Association,” so you know they can handle you and your friends decked out in school spirit.

University of Wisconsin
The Big Ten Tournament start today, oh my! But as all the Badger fans out there know, Wisconsin doesn’t play until Friday. Head to Lotties to guarantee you’ll see your game; they have loads of plasma TVs dedicated to every move of the athletes from Madtown.

The Pony
If you like Kentucky, plan to do your game-watching at The Pony, at Belmont & Ashland. Even if the Wildcats don’t win it all again this year, at least you can watch the Tournament surrounded by friendly faces.

Standard Bar & Grill
Chicageaux’s home of the LSU Tigers is at Wicker Park’s Standard Bar & Grill. Their attempt at making it to the Big Dance starts today at noon, as they take on Georgia. If you’re fortunate enough to have a decent lunch hour or two, pop over to Milwaukee Ave. and pull up a chair; the TVs will be tuned into the game.

Don’t forget to check in & submit your receipt!
Keep in mind you get points for just about any engagement with the aforementioned restaurants. Check in, share with your social networks and submit your receipt to earn Ox&Pen loyalty points.

Continue reading “Where to watch the Big Dance…” »

Yesterday morning, while making the rounds on Facebook, I noticed a thread of comments with regard to a small business in the West Loop and the loyalty programs in which it is currently participating. A few of the commenters were concerned about what happens to their points (which they racked up over the course of many loyal visits) should the small business discontinue its partnership with a given loyalty app/card/program.

These customers’ concerns were totally valid; with many loyalty apps, the points you earn at any given merchant can only be redeemed for rewards at that particular merchant. Should the merchant and the loyalty program in question sever ties, the customers who have 89,000 points saved up are pretty much S.O.L.

Sadly, this type of situation is not that uncommon. In fact, I think we all know someone who was negatively affected by the decision of a merchant to discontinue use of a loyalty program.

In an effort to mitigate the amount of disgruntled customers, Ox&Pen’s loyalty points are good toward rewards at each and every small business in our network of local merchants. In the unfortunate event that a merchant is no longer part of the Ox&Pen network, all the points you earned at that bar during post-softball team celebrations or extra-fun Sunday Funday brunches (you know who you are) aren’t for naught. Any accrued points at that, or any merchant you visit, can still be used like cash at every other merchant in the network.

There you have it. Loyalty points that won’t “go bad.” If you’re concerned about the loyalty program your favorite bar, restaurant, café or boutique is using—and what will happen to your points if they discontinue use—let them know that Ox&Pen circumvents the issue with universal points.

Interested in learning more about the loyalty network built for small businesses? Download the latest version of Ox&Pen for iPhone® or Android™ and follow us on Facebook. Let us know what you think about a universal loyalty network for small businesses!

Continue reading “What happens when loyalty points go bad?…” »

Loyalogy recently released the annual LoyaltyPulse study, an in-depth study of 1,124 consumers across the U.S.

Among the many interesting findings:

• Consumers estimate a restaurant rewards programs would increase their visit rate to a particular restaurant by an average of 35%.
• Nearly two-thirds of consumers (65%) report they would recommend a restaurant more to others if that restaurant offered an appealing rewards program.
• A single rewards program membership covering multiple restaurant brands has significant appeal to consumers. 73% of respondents agreed they would like to have one rewards program membership that was honored at multiple restaurants.

It seems that as daily deals decrease in popularity, merchants are turning to loyalty programs in an effort to incentivize repeat visits. It makes sense, after all; merchants would rather reward customers who come back and pay full price than offer goods and services for 50% off (or more) to patrons who don’t seem to return.

Loyalty programs, as most people reading this are aware, have become more than a punch card you pick up at each restaurant or shop you frequent. Many loyalty programs now come in the form of mobile app that basically aggregates all of the digital punches you earn by visiting various businesses. You can use one mobile app to rack up points at each merchant you visit. Some of these apps tout themselves as a “universal” system. Here’s the problem: the points you earn through such a digital punch card are not universally redeemable for rewards.

Fortunately for the 73% of customers who want one rewards program that honors points at multiple restaurants, Ox&Pen has created a network of merchants, all of which honor points that were earned at any of the other specialty shops and restaurants.

By setting up this unprecedented network of local merchants, customers are now able to accrue points at multiple businesses, across multiple categories, and put them toward rewards at any of the businesses in the network. Yes, that does mean that if you make purchases at Roots Pizza, Krista K Boutique and Leopold, you can redeem your points for rewards at Jefferson Tap. Pretty sweet… I guess you can include the team here at Ox&Pen as part of the 73% that prefers universal points.

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Shopping at local establishments might be as trendy and hip as skinny jeans, but it’s also a practice that can make the economy boom—so much so that wallets aren’t fitting into the back pockets of those jeans. A Local First study found that for every $100 spent at a business that promotes the use of local products, services, and goods, $73 goes back into the surrounding economy as opposed to the measly $43 that comes from big-box chains.

The Local First study is not unique; several other studies reaffirm the positive economic effects of shopping and dining locally. A Civic Economics study found that 179,000 square feet of retail space in New Orleans, hosting about 100 individual businesses, generates $105 million in annual sales, with $34 million remaining in the local economy. In contrast, a nationally-known big-box chain of the same size brings in $50 million annually, with only $8 million staying in the local economy, and requires an extra 300,000 square feet of space for its parking lot.

While the exact numbers vary from study to study, the conclusions are consistent: the more we shop and dine at locally owned establishments, the more money we’re reinvesting in the local community. We can literally have a hand in supporting local farmers, artists, designers and professionals. Not bad.

We all love our neighborhoods, especially in Chicago. What’s good for them is good for us, right? So what can we do, as consumers, to help preserve the character of our communities that small business owners have helped to create?

So what else can be done to encourage local shopping and dining? Daily deals were a platform purported to help small business but they flopped, leaving behind quite a few dissatisfied small business owners and consumers. Currently, loyalty is the industry buzzword, and many startup loyalty programs are trying to fill the shoes daily deals left behind.

How is Ox&Pen filling that void?
Ox&Pen is taking loyalty a step further than other companies in the space. The Ox&Pen loyalty network is designed specifically for neighborhood shops and restaurants, rather than for national chains or big-box companies. By offering universal loyalty points to the network’s consumers, Ox&Pen is able to encourage repeat visits and full-price purchases, something daily deals weren’t able to do, but is of utmost importance to small business owners.

Jake Kaminski, owner of Westminster Hot Dog shared this anecdote: “With Ox&Pen, the point system is set up such that customers want to come back again, and pay full price while they’re at it. When we ran daily deals, we had swells of traffic, but the people coming in were only interested in steeply discounted prices, and didn’t return if there wasn’t an extreme price cut.”

Working at a startup can be hard work, but hearing those words from a small business owner is one of the main sources of drive for the staff here at Ox&Pen. We won’t succeed unless our small business partners succeed, and that pushes us each day to make this work.

Continue reading “Shopping local this holiday season – not…” »

Like any good Chicagoan, I have a healthy sense of neighborhood pride. Irrespective of whatever hip and trendy eateries and boutiques open elsewhere in the city, I still frequent the restaurants, cafés and shops around Lincoln Park and Lakeview. That section of Clark and Broadway between Fullerton and Belmont is my neighborhood, the place I call home. When merchants in the area do well, so do neighborhood residents. When another huge chain retailer goes up half a mile from my building, I get a little upset. Nothing against that particular chain; it’s just that with each big box that appears, a little bit of character disappears from the neighborhood.

Chicago is a city of small, unique businesses and I know I’m not alone in feeling lucky to live among so many great dining and shopping options.

And I wasn’t alone in my disappointment upon discovering Rahmig’s House of Fine Chocolates, on Broadway, is closing its doors at the end of September, after 70 years in business. cbslocal.com reported that current operator Fred Paillon said “times have changed, with storefront shopping at local establishments having given way to one-stop shopping at strip malls.”

Paillon noted decreased local shopping, one unfortunate side effect of an increase in national chains taking over neighborhood streets. Huge chains have economies of scale working in their favor, as well as sizeable marketing budgets and other factors working as barriers to entry for small merchants.

Small business marketing needs are increasingly a focus of attention, and over the past few years, platforms have emerged, packaged as marketing solutions for local merchants. Arguably the most notable was the daily deals model, which exposed merchants to huge, new audiences, but only when they offered up products at a steep discount. The hope was that consumers would be drawn in by incredible deals and would later return for more—and pay full price! Unfortunately, more often than not, customers didn’t return to pay full price; instead, they waited for the next daily deal and went to a different merchant to again pay half price (or less).

The surge of traffic taking advantage of daily deals was significant, but wasn’t always a good thing. Merchants were often left unprepared, understaffed and under stocked, which hurt both business owners and their customers. In some extreme cases, local shops and restaurants were forced to close their doors, due to cash flow problems stemming from a daily deal.

Long story short: daily deals once seemed like a great idea, but they proved themselves unsustainable. Chicago’s unique neighborhoods are in need of a tool focused on preserving their character. It’s not just municipal officials and federal candidates who are stressing the importance of small businesses in this country; consumers are right there with them. The success or failure of small, independent merchants directly affects the neighborhoods in which we all live and work.

That said, I’m proud to work for Ox&Pen, a company committed to driving traffic to independent merchants. Join us as we do our part to support local, unique businesses. What’s good for local merchants is good for us.

Continue reading “House of Fine Chocolates closes, Lakeview mourns…” »

Let’s talk about universal loyalty programs. Those of us earning frequent flier miles with an airline that is part of an alliance can likely redeem those miles for free flights on any airline in said alliance. The same is true of some credit card loyalty systems; every dollar you spend translates into a point that can be used at one of several merchants within the credit card’s network.

While the above examples truly embody the idea of a universal loyalty program, neither caters to small, local business owners or their patrons. Rather, those programs work best on a bigger scale; their loyalty networks are typically reserved for large, national (or international) chains.

In the very early stages of conceiving what would later become Ox&Pen, I knew supporting local businesses would be one of our critical objectives and that the loyalty component would be a huge driver in achieving that. I knew the network effect of the above mentioned loyalty programs could be extremely powerful for small businesses, but there were challenges in creating this with seemingly disparate neighborhood specialty shops.

Often, if our favorite mom-and-pop shop has its own rewards program, it involves a punch-card, where, you get something free with every 10^th purchase, but rewards can only be redeemed at that location. This system works well for people who live or work nearby. But if a particular vendor is on the other side of town, the effort required to get there 10 times might outweigh the benefit of receiving something for free. In this case, the punch-card loyalty program isn’t really added incentive to visit that store over another, and both the consumer and the merchant miss out.

However, with Ox&Pen, you can earn loyalty points for purchases and social engagement at a card shop near your home on one side of town, for example, and later redeem those points using your smartphone at that new lunch place near your work on the other. You feel good because you are shopping locally and earning loyalty points at the same time. The owner of the card shop is also happy; he gains an incremental sale that otherwise may have gone elsewhere. What a novel concept: creating a “loyal” customer, even if just a one-time shopper.

Not only does Ox&Pen’s model provide its members with plenty of flexibility in how their hard-earned points can be used; but business owners benefit by joining forces with other small, local establishments. As a network, they can much better compete against their big-box rivals in the loyalty game.

Continue reading “Universal loyalty network built for small, local…” »

Here’s a true story my friend Ryan just relayed to me about a punch card loyalty program:

Seeking escape from the heat last week, Ryan popped into a coffee shop for a cold beverage. Even better—he had a “Buy 10 drinks, get the 11^th FREE” card on him with 10 punches in it—he was due for a free beverage! After ordering, Ryan offered up the fully punched card as payment, only to be told that the coffee shop stopped accepting those punch cards last week!

Ryan’s loyalty to the coffee shop went down the drain along with the free drink he once thought he had. The points he accrued in the form of punches now have a value of zero; he can’t go down the street to the Italian sandwich shop and use them toward his lunch instead. He can’t even just hang onto them to use at another time. All the money Ryan spent on those drinks was spent in vain. Had he known that the loyalty punches would one day hold no value, he may have gone elsewhere to grab a coffee.

That experiences like Ryan’s exist is a big reason Ox&Pen is a universal loyalty network, and not just a loyalty program. Accrual of universal loyalty points means you have the choice of where to redeem your earned points. Points that are redeemable network-wide also serve as something of an insurance policy. If, for whatever reason, you are no longer able to use your points at a merchant in the network, those points still retain value and can be redeemed anywhere else in the network. Such is not the case for loyalty punch cards. Whether it’s a physical card or a smartphone-based loyalty app, the fact remains that those points are likely redeemable only at the merchant at which they were earned.

Don’t let one-dimensional loyalty points happen to you; download Ox&Pen for iPhone® or Android™ and start reaping the benefits of universal loyalty rewards.

Continue reading “Regular loyalty programs bear little weight when…” »

There is a lot of action in the loyalty space now-a-days. Many entrepreneurs have identified that one thing missing from the omnipresent daily deal sites out there is helping businesses build customer loyalty.

Loyalty programs are nothing new. They’ve been around in some way, shape, or form since commerce began. But perhaps one of the first formal loyalty programs was the Green Stamps program, created by Thomas Sperry and Shelly Hutchinson back in 1896. The basic premise: the more a customer spent at any participating business, the more stamps she receives, and the sooner she would be able to redeem them for rewards.

However, there are loyalty programs sprouting up that have gotten away from this fundamental concept. More and more we are seeing reward programs that don’t take into consideration the transaction itself. For instance, if two friends walk into a merchant and “check in” (the digital version of a loyalty punch card), they would both be rewarded the same amount, even if one of them may spend $50 there and the other, nothing.

Does it make sense for a business owner to equally reward these two people? The customer spending $50 dollars will feel hoodwinked if she knows her budget conscious buddy received the same level of reward. Similarly, as a merchant, which of these two customers would you most like to incentivize to come back to your business?

The last thing any merchant wants is to make an unprofitable customer loyal. Yet, I would argue that the structure of many loyalty programs out there lend themselves to that outcome.

At Ox&Pen, we know there is value in driving someone to a business, so providing incentive for the member to “check in” and get them through the door is in the merchant’s best interest… but it’s just one piece of the puzzle. The goal for that business owner is to then have that member make a purchase… the bigger the better.

Our universal loyalty network is predicated on just this. For each dollar spent, our members receive points that can be redeemed ANYWHERE in our network. The more they spend, the more points they receive. This works out well, because our merchants like it when our members spend money at their establishments… so everyone wins!

While the technological landscape is completely different since the Green Stamps program initiated in 1896, there are timeless aspects of loyalty that are as relevant today as they were back then. Regardless of whether you receive those points via green paper stamps, or scanning a QR code using our smartphone app that then banks your points automatically, the objective is the same… I think Sperry and Hutchinson would agree.

Continue reading “Checking in is just one piece of…” »

If my Facebook news feed is any indicator, buying local is the new black. All anyone can talk about is locally designed and created goods and farm-to-table dining. There is a seemingly unending surge of support for small businesses. It’s the cool thing to do.

But going local is more than just a trend; it makes sense. Here are just a few arguments in favor of local living:

1.  The Numbers
Let’s crunch some numbers first. A study published on Local First Chicago found that if you spend $100 at a locally owned business, $73 stays in the local economy. Local merchants buy from local suppliers; pay local taxes that support local schools, police and fire services; pay wages to local residents; and make donation to causes within the community.

On the other hand, when you spend $100 at a non-local business, $57 leaves your community. This is because non-local companies get supplies and business services from other organizations outside the region and less of their tax dollars stay in the local economy.

There are other studies out there examining the economic effects of shopping and dining locally. While the exact numbers vary from study to study, the conclusions are consistent: the more you shop and dine at locally owned establishments, the more money you’re reinvesting in your local community. You literally have a hand in supporting local farmers, artists, designers and professionals. Not bad.

2.  Unique Items
When I want a unique item, I look first in the independent shops in my neighborhood. Local business owners often get their goods from other independent, local suppliers who create products in small batches. Corporate chains, on the other hand, must stock several locations across the country; to mitigate costs, they often fill their shelves with mass produced goods.

For example, I know when I visit that local stationery and card shop at Fullerton and Clark, I’ll be able to find original cards, designed by local artists, for every occasion under the sun. The same cannot be said of the selection of greeting cards at the Walgreen’s up the road.

3.  Going Local = Going Green = Getting Fit
Shopping and dining in your neighborhood often only requires a walk or quick bike ride. Not only are you going green, you’re also getting some exercise. Plus you’re taking advantage of this great weather (hello 80s!).

4.  Quality Products & Service
Owners of local shops and restaurants rely on each customer who comes through the door. Therefore, they care about each person’s experience and will do their best to make sure you enjoy yours. Years of informal observation have driven me to the conclusion that independent merchants put a good deal of effort into what they offer and the result is higher quality products and services than their big-box competitors.

So there you have it. Four reasons to shop and dine locally. I barely broke the surface, so please feel free to expand. Do you have any reasons to add to the list?

Continue reading “Going Local…” »