Over the last few months location-based game SCVNGR has been partnering with a number of major brands and companies, including the Patriots and AT&T, to participate in its rewards program that gives real-world discounts to players for completing SCVNGR challenges (its competitors Foursquare and Gowalla have also landed major deals). This week SCVNGR launched a key new component to its rewards strategy: a self-serve tool that allows local businesses to set up their own rewards.
Any business can use SCVNGR’s basic features for free by using the edit functions in the service’s mobile clients to build challenges. But SCVNGR also offers a premium, web-based toolset for $80 a month that makes it easier to build and manage challenges. The new rewards feature is part of this toolset and is pretty straightforward: businesses sign on, enter basic information like the name of their reward, and decide how many SCVNGR points a player must redeem to complete a challenge.
Businesses benefit because users have an incentive to come back for discounts down the line, and SCVNGR benefits because people keep checking and engaging with the service to earn more deals. CEO Seth Priebatsch says that SCVNGR sees itself as a nice extension to the group buying model popularized by Groupon, as this rewards ladder can help businesses establish a longer-lasting relationship with the customer (in fact, SCVNGR has been reaching out to Groupon-using businesses to tell them that they should try out the service).
To help spur usage of the platform, SCVNGR has been seeding metropolitan areas, reaching out to businesses that have a history of using social media services (like Twitter) to see if they want to use SCVNGR. Priebatsch explains that SCVNGR works best when a metropolitan area reaches a certain critical mass, at which point the service starts to snowball as more business look to get in on the action. The seed program is meant to help achieve this activation energy. Seed businesses get free access to SCVNGR’s premium tools for a year, as well as a bundle of swag, like SCVNGR coasters. Today SCVNGR is launching with 50 businesses in San Francisco (it launched with 50 businesses in Philadelphia yesterday, and 50 more in Boston last week).
This is an important move for SCVNGR, as it gives businesses a much bigger incentive to sign up for its premium tools. But it’s still difficult to gauge SCVNGR’s success, because it won’t release user stats. The leader in this space is clearly Foursquare, which also offers self-serve tools to businesses looking to create special deals.