Smartphone app gives local shopping a tech boost

| October 15, 2011
There’s an app for that: Tammy Finato shows off the Chatterfly app on her smartphone at San Mateo’s Astaria eatery, where app users can redeem a free brunch for 150 points. (Mike Koozmin/The Examiner) - THERE’S AN APP FOR THAT: TAMMY FINATO SHOWS OFF THE CHATTERFLY APP ON HER SMARTPHONE AT SAN MATEO’S ASTARIA EATERY, WHERE APP USERS CAN REDEEM A FREE BRUNCH FOR 150 POINTS. (MIKE KOOZMIN/THE EXAMINER)
  • There’s an app for that: Tammy Finato shows off the Chatterfly app on her smartphone at San Mateo’s Astaria eatery, where app users can redeem a free brunch for 150 points. (Mike Koozmin/The Examiner)
  • There’s an app for that: Tammy Finato shows off the Chatterfly app on her smartphone at San Mateo’s Astaria eatery, where app users can redeem a free brunch for 150 points. (Mike Koozmin/The Examiner)

A San Mateo company is jumping into the buy-local movement with a mobile application that lets consumers earn discounts and freebies by promoting local businesses through social media.

Chatterfly has 250 locally owned Peninsula businesses in its network, but following a partnership with the 1,000-member San Mateo Area Chamber of Commerce in August, that number could grow quickly.

The chamber’s goal is to use social media as an affordable way to encourage the public to shop at locally owned businesses. For Chatterfly, the vision is devising a contemporary replacement for old retail loyalty programs such as trading stamps or frequent-eater discounts.

“We’re replacing the ‘buy 10 get one free’ punch card and putting it on the smartphone,” said Aaron Stettner, Chatterfly’s senior vice president of sales.

Companies pay $25 a month to participate in the program, which began in March and helps stores track who their customers are, how often they come in, and what they’re saying about the company, Stettner said.

The system is relatively simple. When a customer downloads Chatterfly’s free app onto their smartphone, they get a list of nearby businesses in Chatterfly’s network. After making a purchase, the customer snaps a photo of a QR code provided by the store, at which point Chatterfly deposits 10 points in the customer’s account.

Customers can also earn points by tweeting about a purchase (two points), posting video on a social network such as Facebook or Google Plus (five points), and referring a social network friend to a business they later shop at (10 points).

Business owners also can determine what sort of awards customers can obtain for their points. For instance, with 150 points, customers at Astaria Restaurant & Bar in San Mateo can get a free brunch, co-owner Alicia Petrakis said.

Petrakis’ own rewards program required a “huge” time commitment to track, she said, while managing rewards and promos online with Chatterfly is simple.

Chatterfly may soon offer a global rewards system in which points can be transferred between businesses, or cashed in for prizes such as headphones or computer gadgets, Stettner said.

Not everyone is a fan, however.

“If you say Chatterfly, I say one of a hundred different companies trying to do this,” said David Peck, a partner at the social-media marketing firm Bullfrog Media in San Carlos, who is not convinced the company’s approach will work.

What does make Chatterfly unique is its focus on local businesses. Stettner said the company is not interested in selling the service to big chain stores.

Shopping locally not only supports businesses that give back to the community, but also translates into more tax revenue for cities, said chamber President Linda Asbury. For example, she said, 15 percent of San Mateo’s general-fund budget comes from sales tax revenue.

The Bay Area buy-local movement is growing fast, as evidenced by the emergence of alternative local currencies such as Bernal Bucks in San Francisco’s Bernal Heights neighborhood, Fairfax’s FairBuck and Santa Cruz’s soon-to-launch Sand Dollars. And the Go Local system in Sonoma provides a plastic card that lets customers transfer rewards between locally owned stores.

Fostering business

Chatterfly member businesses: 250
Cities with businesses using Chatterfly: Burlingame, San Mateo, San Carlos, Redwood City and Belmont
Special offer: San Mateo Area Chamber of Commerce members get the first month free
How it works: Businesses set the rewards and point system online and customers scan purchases and promote products through social media to earn rewards

nkyriakou@sfexaminer.com

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