Inside WOM: The New Economics Of Local Restaurant Rewards

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6 min

Inside WOM: The New Economics Of Local Restaurant Rewards
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The local deals space is quite mature, with players like Shopkick, Upside, and now DoorDash fueling cash back deals at local convenience, grocery, and restaurant merchants across the country. The pitch to these merchants is like any delivery marketplace: create a promotion and we’ll send you incremental customers in exchange for a nominal commission. While these platforms are criticized for attracting deal seekers over repeat guests, a brand new a16z speedrun-backed startup called Word of Mouth (WOM) is embracing this promiscuous behavior. One part rewards platform, one part review app, the two-week-old startup calls itself the β€œmost affordable, scalable, and transparent performance marketing channel in the world.” To its credit, WOM has done an impressive job bootstrapping a two-sided marketplace out the gate, but what must it do to be sustainable in the long term? This week, HNGRY β€˜beta tastes’ the app, scanning restaurant receipts and reviewing dishes, and redeeming cash back at Los Angeles restaurants to understand the mechanics at play. 

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