Clovr Raises Cash To Create Ad Units That Link Coupons To Credit Cards
Tuesday, October 19, 2010 by sms
Waltham, Mass.-based Clovr Media is coming out of stealth mode today to announce it has created a new type of loyalty program for banks and financial institutions that link a users’ account to an coupon displayed in a banner advertisement on a PC or mobile device. The company is co-founded by Tom Burgess, who founded and served as CEO of Third Screen Media, the mobile ad network that was acquired by AOL (NYSE: AOL) in 2007.
The idea is a bit complicated, and relies on a practice that’s already being used by financial institutions called Card Linked Offers (CLOs). Today, banks and credit card companies, in which users are offered discounts if they use their card at certain retailers or vendors. There’s several companies competing in that space.
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What Clovr wants to do differently is link the offers to real advertisements when users opt-in to the loyalty program. In this practice, a user could see a banner ad offering a discount, such as $25 off Red Lobster. If the user selects the ad, and eats at Red Lobster, the discount is taken off from the user’s financial statement. Emails or text messages confirm that the discount was received and activated. Burgess said the brand or advertiser only pays when a transaction is complete. Clovr shares the revenues with the bank.
One hurdle will be privacy. A users’ buying history will be obtained in order to serve more relevant ads. However, the program will be completely opt-in, and will use cookies in the person’s browser to make clicking on the ad and obtaining the offer more easy. When using a phone, a person will be able to enter their cellphone number to confirm their identity. In an interview, Burgess said: “This is the next generation of discounts. It doesn’t require a loyalty card. We put it in at the level of the banks, and we enable the parts.”
Investors in Clovr’s seed round include Kepha Partners and Common Angels in the Boston area. Burgess said as part of the company’s launch today, its web site will go live, and it will start conducting trials with a number of unnamed financial institutions. There’s still more work to be done, such as integrating Clovr’s technology with the banks and selling the ad units.
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