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Wednesday, March 14, 2012

Jay-Z, Ink, and Random UPS Thoughts...

Jay-Z at SXSW promoting Sync via Wired
At SXSW American Express and Rapper Jay-Z teamed up to promote Sync - a new service from American Express.

The idea is simple enough:

You register your Amex card with the Sync site.

Then you find special hashtags like #AmexWholefoods and tweet them.

Finally, on your next Amex statement you will get a discount presuming you have made a qualifying purchase.

If you go to the Sync link above you will see a whole array of discounts being offered at the lower right of the page: gas, flowers, food, and so on.

Another interesting app in this regard is Jot from Chase and its Ink card.  This is a standard app that, after you make a purchase, receives info from Chase on the purchase so you can categorize the expense.  You can also do things like monitor and control card limits, track other cards in your account, and so on.

Now I'd like to juxtaposition this with another add I heard on TV the other day.

The UPS store offering $0.25 USDper page color copies.

I mention this because, as far as I can see, neither Amex nor Chase charges anything at all for their new services - at least not money - though you certainly give up information about yourself and your purchasing habits.

The $0.25 pages made me think back to my time spent with companies like Xerox.  Huge and expensive devices to produce color printed material.

Now being replaced by legions of iPhones and other smartphones offering much more targeted marketing in real-time.

Its hard to believe that a mere ten years ago or so the concept of personalized print marketing was such a big deal.  Its even harder to believe that that concept has been is being effectively replaced by smartphones.

To me the Amex model is the right one for many reasons as far as "personalized marketing."

For one, it eliminates all the middlemen, e.g., like a Groupon.  Inside the Amex model its easy enough to offer groups discounts and to link them (perhaps by GPS proximity or time) to a group offer.  The merchant literally does nothing beyond setting up the offer - Amex does all the rest.

The Amex model also saves your from an "embarrassment of riches" at the checkout.  Because the service credits your statement your appear to be paying the "regular" price at the checkout - so no one becomes jealous watching you walk out of Best Buy after paying $200 for a 50 inch LCD TV.

One imagines that this could be extended to other business models, i.e., state food-stamp programs.

So the state, wishing to save money, could make a bulk purchasing arrangement with, say, Walmart.  When foodstamp recipients enter the store they can tweet special codes to allow them to purchase items at a discount to both themselves and to the state.

Similarly, someone like Amazon could simply allow you to tweet special codes and have products purchased and shipped directly to you.  The only problem with this would be the accumulation of empty smile boxes or potential sales tax issues.

Given all this some other infrastructure changes need to be made to help this business model along.

For one, UPS and Amazon need to get away from the "box"and "random delivery" model.

Amazon things should come in a reusable shipping container - not a Chinese-made cardboard box.

Secondly deliver on a regular schedule - not randomly.

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