Standing behind a podium that didn’t hide his bare feet on Thursday, Seth Priebatsch launched a pilot venture called LevelUp that ambitiously hopes to correct the biggest flaw with daily deals such as Groupon: A lack of loyalty.
“We’re going to do what 500 knockoffs in the daily deals space couldn’t,” the 22-year-old Scvngr Inc. founder and CEO said at his Cambridge headquarters. “That is make customers actually come back. … It’s not just about customer acquisition, it’s about customer retention and there needs to be a tool that can do both.”
LevelUp works just like it sounds: After purchasing a Level 1 deal at a business, users can buy better deals at Level 2 and Level 3. LevelUp’s 25 percent commission is smaller than Groupon’s and most Level 1 proceeds go to charities such as Teach for America, the Charles River Conservancy, Community Boating and Haley House.
“The more people that buy LevelUps, the more money we get so we need to mobilize our people,” said Max Fripp of the non-profit Playworks.
Michael Murphy of Emack & Bolio’s has used daily deals before and is using LevelUp, a Metro media partner, to launch his new ice cream pizza.
“[Daily deals] did a great job of moving product but you just didn’t know if customers came back,” Murphy said. “With this model we’ll see if they come back.”
The Google Ventures-backed company started Scvngr, a location-based check-in scavenger hunt that just passed one million users. Priebatsch — who is delivering Saturday’s South By Southwest Interactive conference opening keynote in Austin, Texas — dropped out of Princeton to start Scvngr.
