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VOL. 35 | NO. 12 | Friday, March 25, 2011

App solves problem of keeping up with loyalty cards

By Hollie Deese

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Rob Masri was a traveling man. From Miami to Denver, Seattle to New York, he visited every city, large and small, for his previous job as chief development officer of the University of Virginia Alumni School.

And while he was busy raising funds for the school, he was also steadily collecting stacks of loyalty cards. Donuts, coffee, sandwiches: he had them all, and separated by region of country. Maybe he had two, three or more from the same store, with just a punch or two in each.

Eventually, he began to wonder how many people actually kept those cards and how the businesses were able to keep track of the ones who actually filled those loyalty cards on a regular basis.

Quality control, he figured, was non-existent. Employees might give their friends an extra punch or two, or in one instance, he walked over to a Home Depot and didn’t even need to buy the puncher to correctly pop out an entire card in a few seconds.

“I set out to solve my own problem,” he says.

Masri developed a mobile phone app, Cardagin Networks, as in, where is my card again? And with a patent on using the mobile phone as a loyalty device, Masri has quickly been making a presence in university towns like Charlottesville, Va., Washington, D.C., and now, Nashville.

“It helps local businesses stay in business and the more local business that stay in business, the more jobs stay local and the quicker the economy will continue to recover,” Masri says.

Cardagin basically moves loyalty cards out of your wallet and into iPhone and Androids. Customers can walk into a participating business, show the screen on their phone and have it scanned for credit. Applications for BlackBerry and Windows phones are coming. If they don’t have a smart phone, they can even set up an account using just a phone number.

Businesses have a hard time surviving without a loyal customer base, but it can be hard to tell who that base is, unless you are on the job 24/7. Coupons don’t come with personal information and loyalty cards could be in the pockets of hundreds of customers who may never be back again.

“It’s designed to be convenient and easy for both the consumer and the business,” Masri says. “At the very minimum, it allows them to be introduced to each other. And at the end of the day that is all we are trying to do, facilitate an introduction of the business to their best consumers.”

Masri took inspiration from his father Charlie’s business model, an old school way of thinking incorporated into the latest technology. The elder Masri ran a restaurant for nearly 30 years. Since he was always onsite, he easily developed relationships with his most devoted clients.

“He really got to know his customers, and every once in a while would give out a free piece of pie or say ‘Your money is no good here’ to show his customers how much he appreciated them,” Masri says. “But with businesses today, you may not even know what your most loyal customers look like, much less what they buy.”

It’s an innovation Blush Boutique is banking on to lure loyal customers back and entice new ones to try them out with a deal or promo. They are part of Cardagin’s soft launch in Nashville.

“I love the concept,” says Allie Grawert, general manager of the Brentwood location of Blush. “You don’t have to bring anything with you and don’t have to worry about losing a card. No one is every far away from their phone.”

Blush uses Cardagin to encourage its most loyal customers to remain that way. Registration nets 150 points, and each additional dollar spent results in additional points. Customers can begin cashing in for gift cards at 250 points.

Customer’s purchase and demographic information is recorded so the store’s can track each customer’s personal shopping history.

In the coming year, Masri hopes to hire more sales and marketing people in Nashville, and continue to expand into 40 markets by the end of the year.

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