Retail, Small Business & Startups, and Technology

Ozmott shopping app registers 4,000 retailers

August 9, 2013
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Ozmott shopping app registers 4,000 retailers
The Ozmott mobile shopping app presents users with location-based deals at local retailers. Photo via fb.com

A healthy mix of retailer revenue and location-based deals is the essence of a Michigan-made mobile shopping app.

The app is called Ozmott, a combination of the words osmosis and kismet, said creator and founder Joseph Walker.

The patent-pending software application is a mobile shopping platform that allows users to earn redeemable “Pips,” or credits, to unlock offers on luxury items — by purchasing a deal or sharing one on social media.

The app is available for free download on Apple iOS and Android devices.

Retail reach

Ever since Ozmott went live in Walker’s hometown of Traverse City last spring, its retailer base has taken off, he said, reaching 4,000 locations in almost every state and including major retail names like MC Sports, Guitar Center, Quiznos Sandwich Restaurants, Pet Supplies Plus and Sears/Kmart.

In the Grand Rapids area, Ozmott has registered a growing group of retailers: Excel Academies of Cosmetology, Design 1 Salon Spa, El Sombrero Restaurant, Gaslight Family Chiropractic, Hello Again, Poindexter’s Specialty Marketplace, Southland Auto Wash and Village Bike and Fitness.

Retailers reading about the latest declines of Groupon, Living Social and daily deal web businesses are now realizing that the Internet coupon model is missing something.

Just rewards

What that model is missing, Walker said, is the traditional reward model.

“Their product models are this: They reward the consumer for doing nothing for the retailer,” Walker said. “It’s the reverse of the traditional reward model. Check-in enough times, and you get a free ‘something.’ But it’s not generated a sale, and retailers are realizing it doesn’t benefit them.

“Our model is based on the traditional reward model that the customer does something for the retailer,” he added. “The other way around is what happens when you have a user base, and you’re trying to figure out how to monetize it. It just doesn’t fit into the marketing plans these major retailers have. That’s why you’re not seeing them really work it out.”

"The ubiquitous app”

Major retailers are now expected by customers to have an ecommerce site, he said, and although many have struggled in the move out of a brick-and-mortar-only market, everyone still seems to be looking for the all-purpose retail app.

“What’s happening now is (about) 80 percent of people have a phone in their hand when they shop,” Walker said. “Now the consumer is expecting a retailer to have a mobile presence. Nobody really knows what that is yet."

Retailers that have developed their own apps are “moderately successful, but consumers don’t want to have to (use) a different app each time they go into a different store,” Walker said. “That’s like having to use a new web browser for every different web page you want to look at. So now they’re looking for the ubiquitous app.”

Location-based deals

That’s where Ozmott comes in. The app works as a geo-location feed, showing users where deals are in Ozmott-connected stores on the surrounding map, allowing customers to be rewarded with Pips for their purchases and sharing deals.

The Pips, in turn, open up high-end deals, turning larger sales into an impulse purchase, Walker said.

Not only does Ozmott increase a customer’s basket size, he said, it also moves major items. It’s a more retail friendly, universal reward system than something like Groupon, he said.

“If I were in a Quizno’s getting my sub, I would go through the offers, hit redeem and it would show a promo code,” said Matt Lapham, Ozmott director of business development. “We try to keep the offers the same from location to location, so that if my friend in Holland shares an offer with me, I don’t have to drive out to Holland to redeem this. I can click on his share and find the closest stores to me to redeem the offer at.”

“Stock the app”

In terms of functionality, Walker said that in the next year, he is looking to develop a web interface for small merchants to set up their Ozmott account completely online.

He’s also planning to hire about five more employees, including a marketing professional, to add to his nine-person staff.

“With these sort of apps, you have to stock the app with discount offers first before you really wideband it publicly,” Walker said. “If you don’t, then they download the app and go, ‘Hey, the closest thing is 90 miles away. Forget this.’”

Michigan base

Walker’s growth aims are lofty, but his focus is still local. He has no plans to take his growing company out of Michigan.

In fact, he feels it might actually be the best place to put down roots in an effort to become a major new business.

“We love being a Michigan business,” Walker said. “There’s no reason you can’t have a large software company based out of Traverse City or Grand Rapids. The infrastructure is there. You just need the market.”

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