R4U Offers Business modelCustomer signswith R4U Offers Deal reaches critical mass Customers pay R4U Offers R4U Customer Offers redeems features coupon at Merchant R4U Offers deal merchant signs up R4U Offers pays merchant decides which deals are featured share in a Country area Net Payments made directly, customer to merchant, using platform of payment by R4U Offers.
R4U Offers Business model Brazil local GAP, Body Shop # of geographies national New experimental feature international # of deals x Main deal Categories/ geography R4U OffersR4U Offersnet revenue x Gross/ List price Function of category; Discounted deal seems price x to have increased Net deal size x Discount to customers (%) Share to R4U Offers (%) Typically 30- ~ 50%. May trend upwards 50% due to acceptance pressure.
R4U Offers Customers Benefit to customers Customer demographics Deep discounts Early adopters: Highly affluent with disposable Discover services/merchandise that they didn’t income know of: ‘ Urban females’ Access to new services/merchandise 18-44 yrs 4 smaller ‘side deals’ in addition to Likely facebook and Twitter users main deal 60k-200k users/ country Deal personalization based on voluntary disclosure of preferences 100- 1000 users/deal/country Deals divvied up by Countries
Merchant Observations R4U Offers proposition: Guaranteed revenue and large number of new customers. Key Merchant Economics Best Suited Businesses Revenue: Typically retains 50% of the deal High disclosure for fixed business minus credit card fees High disclosure of offers, by customer indication Redemption rate: 80% Business thriving on repeat customers. Incremental spending: Gap expectation that Rice University study: customers will spend more than just $50, likely 66% successful upward of $75 to $100 once in the store Examples: lifestyle businesses, e.g. services Repeat customers: 22% repeat business (82% successful), sailing, restaurants (58% successful), education Key Issues Today: Normal Sales R4U Offers - Low sales for groups - Minimum sale 5 customers by offer
Merchant Perspective on Customer Interaction Respond to Get customer to follow on Merchant Like it on Offer on Advertise on
Present / Future Competitors(None of them acting exclusively in Educational area like us) Company Groupon •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES Click on •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES BuyWithMe •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES Google • GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES Ebay GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES Yahoo •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES Local •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES newspapers Facebook •GENERAL MERCHANTS NOT EXCLUSIVELY TO EDUCATIONAL PURPOSES
Economic Characteristics Positives Plusses High impact of network effect Brand No technology barriers to entry Economies of scale (‘winner takes most’) No switching cost for merchants and customers Link to access Partner Website for more information Increase substantially number of sales Aggregate sales, in case client doesnt find Sale only for minimum group indicated by product or service interested, he can contact merchant R4U offers to know other types of offers not Low cost to customer acquisition listed by each merchant. Pay just commission per product or service sold.