The online coupon search industry is very crowded, with dozens of sites, players large and small, and is a very confusing landscape for consumers. Is there an opportunity to rise above the crowd, and become a leading player in the industry for a startup? One local startup, Chippmunk (www.chippmunk.com), hopes so, and believes that focusing on user interface design will help it win over its competitors. The company recently raised a $750,000 seed round of funding. We spoke to CEO Brian Nickerson--an Internet veteran with time at Yahoo and Internet Brands--about the company and its goals.
What is Chippmunk?
Brian Nickerson: Chippmunk is a savings search engine. We organize savings online. We make it really easy for consumers to compare information across similar retailers, and find the best deals. One of the big problems we noticed in the space, was that similar retailers were offering very different deals on any given day. For a consumer, that makes it difficult to find and compare information. We wanted to have a five second, quick and easy way for consumers to find out who has the best deals, and provide more information and power to consumers so they can make important choices, and ultimately spend their money more wisely using deals and discounts.
There's a ton of coupon and deals sites. Why are you different?
Brian Nickerson: It's definitely a crowded space. There are lots of large players, and lots of small players. I think there are a couple of ways we differentiate ourselves from others. One, is most of our team has worked together in this business for several years. We're intimately familiar with the pain points that retailers feel, and which consumers have been feeling as well. We're out to solve them in a way that differentiates us from others. One of the biggest issues, is that consumers typically find coupons through a Google search query. They do a Google search, and they're presented with thousands of sites in the search results. All of them offer the same kind of coupon information for a store or category, but many of those sites that show up have very poor results. They don't have coupons that work on that given day, the layout and design looks really spammy, and it feels spammy. We feel like the industry hasn't evolved, and there hasn't been a brand that stands for quality information in this industry. That's what we want to create. We want to create a great consumer experience, which is significantly different than cookie cutter, cut-and-paste coupon sites.
What's the background of your team?
Brian Nickerson: I started out at Yahoo, in their search group. That's where my background in search algorithms comes from. I then went to another local company, Internet Brands, which was originally an Idealab company, and had the opportunity to build their shopping division. From that experience, I was looking at every coupon, deal, and product site out there, because they were very active on the M&A front. They made a number of significant acquisitions in that space,. My co-founders, Samira and Chris, worked together at Internet Brands. We have complementary skill sets. Samira has several years of experience in product, and Chris is an outstanding developer, engineer, and architect. It's that experience, specifically, in buying similar kinds of sites, running them, and getting insights into the opportunities in the industry, and challenges, which gives us the new opportunity to innovate and make the consumer experience much better.
One of the big challenges in this industry is sourcing information. How do you do that?
Brian Nickerson: That's a little bit of our secret sauce. That's where our coupon ranking algorithm comes in. It's a huge data challenge, and it's a challenge both from a sourcing and quality perspective. It's a place where we think many of our competitors have taken a shortcut, because it's such a big problem to solve. There's an underlying reason for that, because many businesses are paid on the click or effectively paid on the click, so they've taken shortcuts in terms of the quality of the information they provide, because it still pays off in the short run. However, where the industry is going, it's much more about a quality experience, and an experience that delights the consumer at the end of the day. With our CouponRank algorithm, we think we have something which is a big game changer, and that is really the core focus of our algorithm and the engineering solutions we are building to solve that problem. It involves understanding what is the latest information, does it still work, and will a consumer be able to transact. It's all about the quality, and how a consumer can find that information, in an authentic way, and ideally so that consumer can transact with what they've found. You don't want a consumer to find out that something didn't end up working, that they're not able to consummate the deal, and they're not able to get that discount.
What did you learn at Internet Brands about these businesses, and how are you applying that here?
Brian Nickerson: That's a great question. Internet Brands is a very entrepreneurial place. We would make an acquisition, and very soon after an acquisition we'd have a team of people from the company we had acquired reporting into our group. We had to move pretty quickly to meet our aggressive growth targets. I think that one of the things I took away, from that experience, was the importance of quality content, and the importance of a long term perspective. Content is king, and most people think of that as entertainment, video, or music content. But, that actually extends into all content. Particularly in the coupon and deal case, it's the content that surrounds that deal information. So, one of the things we've done, is we've taken a holistic approach on how we create content. It's not just coupons and deals, we've also launched a blog with helpful shopping information, which helps introduce consumers to new brands they might not have heard of before. One thing we've realized, is that consumers really like that kind of information. Plus, for retailers, it's useful because it's very easy for a consumer to think of a retailer in a particular way, when they might have more to offer. A specific example of that is Vistaprint. They're known for business cards, and they do sell business cards which are a good deal and get into your hands very quickly. However, as a business, they do way more than business cards. They also sell holiday cards, stationery, photo printing, canvases, and all these other things. They sell these products which consumers are just not familiar with. So, as we think about creating high quality content, we think about introducing consumers to other products a retailer might have, and also how to help them save money when they're ready to transact with that retailer.
What's next for your company?
Brian Nickerson: Obviously, we're delighted to close our seed round of funding. We've got a great group of investors, who have very deep expertise in content publishing, in search, and running Internet businesses. The next big thing on our plate is expanding our beta program, Chippmunk Rewards, which helps content creation partners better monetize their content, by adding coupon and deal information into the consumer experience. We've really just launched that program, and we have a few strong beta launch partners, and we see lots of opportunities to extend that originally created content to our blog, and social media. We hope to bring our coupon content, and give them the opportunity to provide those coupons to their readers, and enhance the relationship they already have with their audience, and also give them the opportunity to derive a transaction from that.