Google Ventures-Backed Signpost Brings Repeat Business to Daily Deals
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publishers to post the deals. The company primarily works with retail-oriented small businesses, though it may explore other categories as well.
Through the partnership with Google Offers, Signpost’s clients can also be discovered by users searching Google Places, which offers recommendations on local businesses. Wall says his goal is to help businesses attract more repeat local customers than onetime discount opportunists who are just passing through. “Sometimes with daily deals, a number of buyers would never go to the businesses on their own and probably won’t come back,” he says.
Daily deals can come with a few drawbacks, of course, particularly for small businesses. “What we don’t like is they tend to be inflexible,” Wall says. “You can’t set the terms on how many people receive the offers.”
He says another potential problem is a misalignment of goals between daily deals site operators, who want to sell as many offers as possible, and businesses that want more repeat patrons who are not driven just by discounts. Wall estimates that 10 percent of daily deals customers come back to pay at full price.
Signpost began with a business plan Wall drafted in 2009 while at Harvard Business School. His initial idea was to help small businesses who were not already online get noticed on the Web. “If you’re an offline business, it is really expensive and inefficient to advertise online,” Wall says.
He launched his startup, at the time named Postabon, in early 2010 as a platform that invited consumers to post their favorite specials and discounts from merchants, much like a Yelp review. “If we had a lot of information we could get consumers to look at it and then offer premium listings to businesses,” Wall says.
But he soon realized that approach was not effective. “We weren’t closing the loop,” he says. “We didn’t know who was actually visiting the businesses.” Postabon changed its name to Signpost in October 2010 and then in 2011 pivoted to operate as an online advertising go-between. Signpost negotiates rates and alleviates some of the legwork for merchants by suggesting Web publishers that fit their needs. “The average business owner is getting like five calls a day from some of these [daily deal] sites,” Wall says.
Wall says Signpost is avoiding the model of marketing discounts in massive floods, which may encourage consumers to seek offers from many merchants rather than become repeat customers at a select few. “Our objective is getting good customers to our businesses, not selling the most offers possible,” he says.