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Touting quite an impressive track record as CEO of Apartments.com, Spring Marketplace CEO and co-founder Bruce Mitchell has set out yet again to do something unlikely.
He wants to “connect the digital environment with the payment environment” with Spring Rewards, a “friction-free” rewards network that uses customers’ credit cards while also creating a one stop shop for businesses looking to track the impact of their digital marketing spends.
“Every marketing initiative out there, you really can’t tell whether it’s successful,” Mitchell said. “Even Google just measures clicks, not revenue in the real world where 95 percent of all commerce happens.”
Many business owners have just “all assumed that it is the way it is” and accepted that they can’t track their marketing and revenue, while consumers have settled for fragmented loyalty and membership programs from each place they shop.
But the Spring team wants to solve all of these problems and they are in it for the long haul. Working on the problem in stealth mode for roughly a year, they built up the business knowing that it had the potential to rock the market.
Over the last year of working in stealth, Mitchell said he was “paranoid as hell” that someone else would beat Spring to the punch because “the market opportunity is massive and everybody knows it.” Because there was - and still is - lots of movement in the rewards and digital marketing space, Mitchell said “the whole time I was truly freaked out about if we would ever get there.”
But now, with their public launch about 12 weeks behind them, Spring has gotten there: “This year, we went from ground zero to building the product, the team, signing up clients and raising capital.”
In this short time, Spring has seen some serious traction with about 200 businesses in Chicago signing up for Spring Marketplace. Those businesses have already seen about 240 percent more members enroll in their loyalty programs as a result of Spring, Mitchell said.
This growth is happening so quickly because signing up for Spring Rewards truly is “friction-free” on the consumer side. Spring members sign up once for Spring Rewards and then can later choose to opt-in to the loyalty programs of other businesses in the network; Mitchell said 99 percent of Spring members do that and join two or more loyalty programs through the Spring network.
The early success that Spring has experienced can be attributed to Spring’s Chicago-based investors like Chicago Ventures, Chicago-based acquisitions like Toodalu and also to the 30-person Chicago-based team. The choice to headquarter the company in Chicago was a deliberate one by Mitchell, who lives in San Francisco, and by co-founder Jonathan Dyke, who lives in Nashville.
“We just felt it was the right place for this company,” Mitchell said. “There was a team of people we knew we wanted involved, as well as just the overall environment and talent pool that’s in Chicago. It was very intentional.”
Chicago is also home to competitors like Groupon, where Mitchell spent some time himself as an advisor, and Belly. Groupon, Mitchell said, set the stage in some ways for Spring: “What Groupon showed was how much pent-up demand there was among small businesses for a better marketing solution than they had.”
Spring is helping those small businesses by providing them a better marketing solution that serves “the entire lifecycle of the business,” not just customer acquisition or engagement.
Though they are starting out serving 200 businesses right now in Chicago, Mitchell said Spring has its eyes on other markets down the line, like Nashville. By end of 2014, Spring expects to have several hundred thousand consumers and 1,000 clients in the Chicago area. After that, the team is hoping to bring on board over 50,000 businesses in North America over the next four years.
Though they are definitely are not the first or the only ones trying to tackle the problem of fragmented rewards and marketing program, Spring is tackling the problem in such a simple, unique way that it just might work, Mitchell said: “Even now, there’s no one doing what we are doing the way we are doing it.”
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