Technology July 2013

The Power of Word of Mouth

Friend-based app helps shops create online member programmes

Christian Schmitz (left) and Loren Fykes’ Quchy app allows users to keep track of places they have visited.

Advertising is helpful and promotions have their uses, but entrepreneurs Christian Schmitz and Loren Fykes are firm believers in the overwhelming power of word of mouth.

The new Quchy (pronounced koo-chee) mobile application, which went live in early May, takes its name from the Japanese term for word of mouth (kuchikomi) and lets users keep track of visited places, organising that collection of locations as recommendations for friends.

Quchy differs from other applications because it is friend-based, Fykes told BCCJ ACUMEN. Users cannot follow unknown account holders.

“This is really important because you are able to see the places friends have been to and you’ll be far more trusting of their opinions precisely because they are friends”, said Fykes, founder and chief executive officer of the firm behind the service, Endymion, Inc., and the brains behind the application.

“With other sites, anyone can make up any sort of false review—basically an advert—so you never know whether a restaurant is any good until you go there yourself”, he added.

Taking a pack of cards as a template, a Quchy user can find a favourite restaurant and add that business card to his or her collection—much like restaurants have business cards alongside the cash register. These digital cards, which can hold a host of information—including opening times, reviews, address and pictures—are visible to friends who might want to visit. The more users share and recommend places, the more points they earn.

Shops see who is talking about them the most and may thank with rewards those customers who opt-in.

Users can add any card from any city in the world. If it’s not there, e-mail them, and it will be added to the database for you. Search for The World’s End, for example, and the user is directed to the popular pub in Camden Town, London.

Cards can also be organised in decks for easy reference, such as the best places in Tokyo for business dinners, and a user can browse friends’ decks.

An added element is the Connoisseurs page, where people who are knowledgeable about a certain cuisine provide details of the best restaurants.

Quchy traces its genesis to the Kudos Member Benefits Programme, the web-based service that provides members who sign up with significant savings on everything from meals to hotel stays and test drives of top-of-the-range cars.

Schmitz, originally from Germany, took the largely inactive business over in May 2011 and set about transforming it into the meeting place for businesses with products and services that match the needs of a high-end a clientele.

Today Kudos has more than 10,000 members and some 400 partner vendors, Schmitz said, with the typical member a high-earning, internationally minded person.

Quchy will bring the service to mobile with an increased level of user interaction.

“Many stores think that loyalty is about point cards, how much a customer spends, how many times they visit the store—but these are all traditional and out-dated concepts”, Fykes said.

“That’s not real loyalty; true loyalty is a conversation you have with a friend in which you talk honestly about a place and tell them how much you like it”, he explained.

“Conversations are viral, but a lot of service providers do not know how to capture that conversation and make that into a quantitative and measureable way to generate traffic for their business”, he said.

The firm is working with an engineering team that includes the former head of the genome-mapping project at Stanford University to devise ways to track conversations as they spread and use that data to identify the best way to get conversations started.

Creating the application presented some technical obstacles, Fykes admitted. But the system’s potential was recognised by an angel investor, and additional funds were forthcoming from Samurai Incubate Inc., Japan’s hottest investor in up-and-coming concepts.

Endymion is the first foreign-owned firm to secure funding from the start-up accelerator.

With funding in place and the system operational—and new additions to Quchy’s capabilities anticipated soon—Fykes and Schmitz know they have a lot on their hands.

“It is perfect for users, but our focus is supporting shops and small businesses with their social media strategies”, Fykes said. “We are effectively creating social membership programmes for them and creating a network of great benefits for users.

“We’re helping shops to have conversations with their most loyal customers”.

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