By Aimee Chanthadavong
Buying website Cudo.com.au is offering retailers the chance to sell to a large audience by taking advantage of its advertising and marketing support.
Launched in September, Cudo is a joint venture between Microsoft and PBL media and offers a daily discount in Sydney, Melbourne, Brisbane and Newcastle.
Billy Tucker, Cudo CEO, told Retailbiz that it represents retailers by giving them a chance to promote themselves.
“If you look at a typical group buying they only have a single captive audience and their primary goal is to grow that audience because the bigger the audience, the stronger their buying power is meaning they can negotiate better deals with retailers,” he said.
“But we don’t just talk to our members. We use television, we use Ninemsn and in fact, on the whole, we talk to more people who are not members and we present great offers to them. What we typically want is to represent a merchant in a good light so that they can find new consumers to trial their product.”
“The service for retailers is that we can provide them with an enormous amount of exposure and an opportunity to win a whole bunch of new customers but then it’s really up to them to up-sell and find a way to attract loyalty.”
Since Cudo’s launch, retailers have offered discounts of up to 91 per cent off the recommended retail price.
Trial is key to attract and create a loyal customer base, Tucker said.
“The businesses that it works best for need to meet a few criteria. Typically, they have to be relatively central so they have access to a large population and they would typically have high fixed costs and excess capacity enabling them to offer a good discount. Trial is important in providing customers a sample of your service so that they will want to come back,” he said.
“The other criterion is that you have got to provide something really good and if you’re going just provide an average product then it’s not going to work out for you. Also, you should have some CRM in place so you can manage people who come through the door and send them emails, bringing them back and getting loyalty from them.”
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