It is not a secret that our generation is going mobile. To be specific, according to a study published this year by the mobile measurement and advertising platform Flurry, the average American spend 162 minutes on their mobile device per day, and 86% of that time on mobile apps.
We do everything in our phones, and companies have noticed. One industry that has been trying to go mobile for some years now is the payments industry. Only last month one of the biggest brands announced its participation in the payments industry, and yes, I’m talking about ApplePay. However, I don’t want to talk about mobile payments per se, I want to talk about an app that has integrated location based marketing with mobile payments.
LevelUp launched in 2011 as a “daily deals” app, but after 3 months it evolved to a mobile payments platform free to download for iPhone, Android and the Windows Phone. LevelUp make profits out of payment transactions. This means that for every user that pays with LevelUp in a store, the company gets a percentage of that transaction. This also means that LevelUp have two customers: Users and merchants.
The Users are the people that download the app in their phones. The app is totally free for them to download and use. The Merchants are the businesses that have the hardware and software to accept that payment. For Merchants there is a transaction fee. Currently this fee is 1.95% of the total transaction if they use LevelUp.
But payments are not the only functionality of LevelUp. The company realized that there was a need to engage the customers to come back to the merchants (their other users), and pay with the app. To do that, LevelUp offer merchants the ability to track loyal customers, and approach new customers that are close to their business.
How does this work?
Well, if the merchant agrees to be part of the LevelUp loyalty program, every time the users pay in the store, the app saves the information and after certain money spent in the store they would get some money for free for the next purchase (i.e. spend $50, and get $5). On the other hand, users that have never been to that specific store can find a new location using the app.
For example, if I’m not familiar with the Financial District in New York and I’m starving, I can go to the app and it will show me all the restaurants that accept LevelUp. It will also show me the deals I can get if I go to that restaurant.
Even if the mobile payments industry is in a confused state right now, it is interesting to see how technology is changing the way we to interact with businesses. We have been paying the same way for decades, maybe is time for something new!
Nelly Ortiz 