My first encounter with Swag’r was a bit unusual. My girlfriend and I were going to get snacks at the concession stand during the BC vs. Notre Dame hockey game when a Swag’r campus rep flagged me down with an interesting promise. “Hey there! Do you want $25 for free?” I have become quite good at ignoring advertisers yelling at me, but the potential for free money got my attention. Intrigued, I approached the table and was told that if I was one of the first ten people to go around campus and check in at four different geotagged locations, I would get a $25 Visa gift card.
I couldn’t have ran fast enough. Within fifteen minutes the two of us had sprinted all around campus and made it back to the table in Conte. And in spite of my skepticism, the Swag’r team actually did hand me a $25 Visa gift card. After the excitement simmered down, I stood back and realized what had just happened. An app had just convinced me to leave a huge hockey game to go run around in the cold, and I had no regrets. That’s when I knew Swag’r had something special.
Company Overview and Business Model
Swag’r was founded in early 2014 by Greg Williams, who currently serves as Chairman and CEO. The company’s sole product offering is a digital location-based app that serves as a rewards program for its users and as promotional method for brands.
The business model of Swag’r is as follows:
- Swag’r partners with businesses and convinces them offer rewards on the app
- Users of the app visit a geotagged location marked on a map and pick up their prize
- Users then redeem their prize online or in person
Simply put, this business model helps businesses to promote themselves and it helps consumers to get free stuff. It’s truly a win-win situation. And because of this, Swag’r’s cost structure is very lean. Furthermore, almost all of the revenue they will make from digital advertising will become pure profit due to the aforementioned low cost structure.
Swag’r is self-described as the Pokemon Go for brands, and this seems to make a good deal of sense. Pokemon Go was able to achieve massive, albeit brief, success as a fun and interactive gaming platform. Swag’r is basically saying that they are the same thing as Pokemon Go, except you can get things of real monetary value. In addition, Swag’r turns the annoying world of digital advertisements into a fun and interactive gaming experience for consumers. These consumers use the app in a four step process:
- Open the SWAG’R map to find the swag points nearest you
- Find offers that peak your interest enough to seek out
- Grab deals that you find and want
- Redeem, Share, or Gift the rewards or discounts for real monetary value
See here a slideshow of screenshots from the iPhone app
While consumer users of the app can benefit greatly, the company seems to be positioning itself more as a brand-building tool from a business perspective. See their LinkedIn profile below.
Swag’r is a whole new way for brands to engage with mobile consumers. We use gamification and location based technologies so brands can communicate with users when they are in predicable locations like a college campus, shopping mall, sporting event, or a military base.
Swag’r offers many specific features on the app to entice brand’s to participate:
- Cloud-Based Management for efficient and real time interactions with users
- Detailed Analytics for brands to evaluate, adjust, and improve their marketing strategies
- Marketing Optimization that allows brands to customize and optimize their rewards and discounts offered on the app
- Gamification, a system that is proven to consistently reach consumers more than traditional means of digital advertising
- Geo-Location which allows brands to place their offers at physical locations beneficial to their operations
- Social Media integration, which helps to build a brand’s online presence overall
Swagr places significant emphasis on its data analytics capabilities as a means of positioning itself as a brand-centric business that can add real value for its partners. The primary part of their analytics platform learns to make accurate predictions about consumer, social, and mobile habits. This data is then used to engage certain users with brands that will likely be relevant to their needs. The most important part of these analytics is that the results have been proven to be ten times more engaging than traditional mobile advertising, since the content is targeted at a specific demographic group.
Product Launch & Financials
Although the company is headquartered in Portland, Oregon, the initial product was launched at ASU in Arizona last spring. The second product launch was right here in the Boston area and occurred in late 2016. Current areas of operation are Boston College, Boston University, Harvard, and MIT. The product is expected to expand in the future as it is rolled out in new locations across the country. In addition, Swag’r has recently landed some strategic partnerships with companies like Lyft, goPuff, and Victoria’s Secret, and many more, which could potentially double their organic growth.
While the financial performance of the company is relatively private, there are a few things we know. For one thing, the company has raised $325 thousand in a seed round and $1 million in a convertible debt security. Additionally, one could surmise that the company has yet to make substantial revenues and profits due to its relatively recent product launch. However, some analysts estimate that the company has already booked an estimated $500 thousand in TTM revenue, and those numbers are expected to grow. Scaling the operation will be relatively inexpensive and rapid, and such scaling could bring significant rewards given profitability of the Swag’r business model.
If you enjoyed this article and like getting free stuff, be sure to check out the Swag’r website at gotswagr.com as well as the instructional video below!