Constant Contact Takes on Daily Deals Giants with Launch of SaveLocalä
Constant Contact to small businesses: Take back control of your deals
WALTHAM, MA – February 28, 2012 – Coming to the defense of small businesses that continue to get burned by running local deals, Constant Contact®, Inc. (NASDAQ: CTCT) has announced the launch of SaveLocal, a new online tool that will help small businesses run profitable, effective deals. SaveLocal addresses critical problems with the current daily deals model – problems that put merchants at significant financial and organizational risk, problems created by business models that usurp all deal control from the merchant. SaveLocal flips the current model on its head, giving merchants complete control and allowing small businesses to run deals that make sense financially, incentivize social sharing to attract qualified new customers, and drive repeat business.
“We know that deals are something that consumers want today. The great news is that deals can work if they are done right. The problem is that the current options in the deals space just don’t make sense for many merchants, especially small, local businesses,” said Dave Gilbertson, vice president and general manager of Constant Contact’s newly created SaveLocal business unit. “The current options demand that the merchant relinquish total control of the deal. They require steep revenue sharing and attract deal seekers rather than new, long-term customers. Amazingly, the current options don’t even give merchants the contact information of their buyers to give them a fighting chance of turning those buyers into repeat customers. And unfortunately, all of this can have a devastating impact on the merchant.”
In fact, the problem with the deals model as it stands has been documented frequently in recent months, with story after story of merchants pushed to the brink – or worse, put out of business – because of the upside-down economics of running a local deal.
“Doing a deal for the sake of doing a deal just isn’t enough, especially if there is a risk of hurting my business, which is all we heard from those who had run deals through other vendors,” said Kirk Jamison, owner of KT’s BBQ, which has four locations in Colorado and was one of a few Constant Contact customers who tested an early version of SaveLocal. “It’s important to be able to say, ‘I invested X, and I got Y for it.’ We had a lot of calls from other deal vendors but the economics just never added up for us. SaveLocal was different. It seeks to add value for our own customer base. We grossed about $2000 and netted over $500. What's more, 27% of the purchases were made by new customers to our business, and we added more than 100 new subscribers to our email list. It was a real winner.”
With SaveLocal, the merchant gets full control of the deal: the discount amount, the terms of the deal, timing, and how many coupons to sell. Deals can be created and published in minutes and are completely free to send to the merchant’s email list and social networks. And, in stark contrast to other deal vendors who typically take 50% of each coupon sold, with Constant Contact’s simple 1-2-3 pricing model, merchants pay just $1, $2 or $3 per coupon purchased, depending on the value of the deal.
SaveLocal also drives deal sharing; merchants can reward those who buy the deal with an additional reward when they share the deal with their friends via email, Facebook®, or Twitter®, expanding the business’s reach beyond its current network. Additionally, SaveLocal collects contact information for everyone that buys a deal, including permission for the merchant to communicate with them going forward (they can, of course, opt out at any time), arming merchants to build long-term relationships and keep customers coming back.
“The value of running a deal for small businesses is bringing in new customers, not one-time deal seekers. Word of mouth has always been the best source of new customers for local merchants, but it has been difficult to incentivize and track,” said Gilbertson. “That’s the magic of SaveLocal. It starts with your current customers – those who are most likely to recommend you – and rewards them for sharing the deal with their friends and networks, who tend to be highly qualified customers for you.”
As part of its preparation to enter the deals space, Constant Contact recently acquired MobManager, a Chicago-based company with deep expertise in how to make deals work for the merchant. The MobManager team joins Constant Contact as part of the SaveLocal team, providing valuable knowledge that will help drive future product innovation. Financial details of the transaction were not disclosed.
“With more than half a million small business customers, we know small businesses – their needs, their passion, and their pain points. The MobManager team has deep expertise in the local deals space and brings us some fantastic talent to help drive this new offering,” said Gilbertson. “This really just adds some icing to the cake that we were already baking for local merchants, and we are excited to have the MobManager team on board.”
SaveLocal joins Constant Contact’s growing suite of online marketing tools designed to help small businesses create and grow relationships with their customers. SaveLocal is backed by Constant Contact's unrivaled small business expertise, KnowHow, and world-class personal coaching.
SaveLocal will begin rolling out to US-based Constant Contact customers beginning on February 28, 2012. The product will be rolled out to other US small businesses and those outside the US later this year. Those interested in learning more, can sign up at www.constantcontact.com/savelocal.
Constant Contact will host a conference call for the investor and media communities today, February 28, at 9:00 am ET. To access the call:
Constant Contact is revolutionizing the success formula for small organizations through affordable, easy-to-use Engagement Marketing™ tools that help create and grow customer relationships. More than half a million small businesses, nonprofits, and associations worldwide rely on Constant Contact to drive ongoing customer dialogs through email marketing, social media marketing, event marketing, and online surveys. All Constant Contact products come with unrivaled KnowHow, education, and free coaching with a personal touch, including award-winning customer support.
Constant Contact and the Constant Contact Logo are registered trademarks of Constant Contact, Inc. All Constant Contact product names and other brand names mentioned herein are trademarks or registered trademarks of Constant Contact, Inc. All other company and product names may be trademarks or service marks of their respective owners.
Cautionary Language Concerning Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding the launch of SaveLocal and the impact the launch will have on Constant Contact's business and operations. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of our management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend, "variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Constant Contact's control. Constant Contact's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, the success of the SaveLocal product, the company's ability to attract new customers and retain existing customers, the company's dependence on the market for email marketing services for small businesses, non-profits, and associations, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which the company operates, adverse regulatory or legal developments, the company's ability to continue to promote and maintain its brand in a cost-effective manner, changes in the competitive environment, the company's ability to compete effectively, the company's ability to successfully develop and introduce new products and add-ons or enhancements to existing products, the company's ability to manage growth, the company's ability to attract and retain key personnel, the company's ability to protect its intellectual property and other proprietary rights, and other risks detailed in Constant Contact's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Constant Contact's views as of the date of this press release. The company anticipates that subsequent events and developments will cause its views to change. Constant Contact undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Constant Contact's views as of any date subsequent to the date of this press release.