Re-Tweet & Reward
Full of swagger and social media-savvy, Social Rewards is the brand loyalty program for the digital age.
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When Lala Castro visited Las Vegas with 15 girlfriends last summer, she stayed in a palatial private suite at The Palms. The room was tricked out with amenities typically reserved for those with black cards, like a private pool and a secluded driveway. "The whole place was just amazing," she says. Even more amazing than the room was the bill: zero dollars and zero cents.
Castro enjoyed her high-roller suite for free thanks to Social Rewards, a web-based service that repays customers for spreading the word about their favorite companies using social media. Castro was planning a girls' weekend in Vegas when she learned she could earn a free room through the program. She set right to work, spreading the hotel's deal to all of her Twitter followers and Facebook friends. Soon, a dozen of her friends had booked rooms at The Palms through a link she shared on Facebook, earning Castro a free deluxe room of her own. When she arrived at The Palms and mentioned Social Rewards, Castro was upgraded to the Val-halla by a staffer thrilled to meet an early adopter of the new program. "It was like one lottery ticket after another," she says.
Social Rewards is a customer loyalty program for the digital age founded in October of 2010 by entrepreneur Joseph Morin and his tech guru Mike Uesugi. The company teams with brands to develop programs that reward customers for singing their praises on Twitter, Facebook, Foursquare and YouTube. A re-tweet can be worth up to 25 points for a customer, while a sale generated by a shared link could earn him 250 points. Those points are redeemable for free rooms, free meals or, for those staying at the Luxor, free tickets to see Carrot Top.
"We just wanted to get rewards for talking about the brands we love," Morin says, explaining how he and Uesugi came up with the idea for the company. "We couldn't find anything that did that, so we created it." It wasn't much of a leap for either of them. Morin is a Silicon Valley veteran who founded and sold a startup called Storybids and has worked as a marketing consultant for dozens of websites. Uesugi, who designed the infrastructure of Social Rewards, founded an internet consulting firm in 1993, back when most people thought the web was just for spiders.
Thanks to their previous successes, Morin and Uesugi were able to self-fund the company for $250,000 (they've collected an additional $250,000 in angel funding since) and immediately set about finding clients. Morin first turned to Vegas, where he's worked as a marketer for almost a decade. He was able to tap his connections to casinos, which have long run loyalty programs and were therefore in a perfect position to try Social Rewards. "They're willing to try anything at casinos," Morin says, "and if it works, they'll go all the way with it."
Just over a year in, Social Rewards has expanded its portfolio beyond hotels and is now working with movie theaters, restaurants and live event promoters in cities across the country, including New York, Orlando and Washington, DC. The scope of Social Rewards makes it a tool travelers can take advantage of whether they're trying to score a hotel, a meal, entertainment or transportation.
The growth of Social Rewards is no surprise, says Tamar Weinberg, social media strategist and author of The New Community Rules: Marketing on the Social Web. "It encourages people to go out and share their positive experiences," she says. "When someone tweets their endorsement of a product, people are much more compelled to trust them than the company itself."
"Word of mouth is the most influential driver of business," says Brad Goldberg, vice president of marketing for Luxor/Excalibur. "Having people mention our offers to their friends is much more powerful marketing than us sending out an offer to the masses."
It's much more pervasive too. Morin says before teaming up with Social Rewards, a tweet by a casino's oļ¬cial account would get re-tweeted two or three times. Now that fans of those properties can earn points by spreading the message, their tweets get upwards of a thousand re-tweets. "We're amplifying their social message by pushing it out not only to their fans, but to their fans' fans," Morin says.
When one of their tens of thousands of users pushes a deal, Morin and his staff of six also benefit. For each re-tweet, reply or Facebook like, Social Rewards charges its clients 10 cents. That, combined with a cost-per-acquisition model in which brands pay Social Rewards a percentage of each sale it facilitates, has the young company anticipating profitability by the end of 2012.
And Lala Castro, for one, intends to contribute to that profitability. She's already planning her next trip using Social Rewards. And this time she wants to stay at the Luxor. "It's been 10 years since I've been there," she says, "but Social Rewards is drawing me back."
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