A Q&A with FreeShipping.net CEO Tom Caporaso. The company is a wholly-owned subsidiary of Middletown, Connecticut–based Clarus Marketing Group.
SUB: Please describe what FreeShipping.net is, and the value proposition you bring to ecommerce.
Caporaso: Freeshipping.net is an interactive coupon site where users can go to earn badges and trophies, vote on coupons and communicate with other users, all while saving money on their purchases.
The online coupon space as it stands has been overdone. We knew in order to do this well and engage consumers, we needed to be drastically different. Our value is that we are more relevant to the community of savers. We wanted them to know they have an influence in how they save and providing both a social and gaming component accomplished that.
SUB: Who are your target markets?
Caporaso: We wanted to appeal to those who do most of their shopping online, usually consisting of women age 25 to 54. But with the unique components we have evolved into the site such as the gaming, we are hoping we will also appeal to men in that age range.
The economy is still on the mend. Any product that can save consumers money is sure to be welcomed by the public. FreeShipping.net is a free option for online shoppers. So while we had an initial target audience in mind, we know that will expand organically once word spreads among consumers.
SUB: Who do you consider to be your competition?
Caporaso: In general, any other couponing sites could be considered competition. However, no one has built anything quite like FreeShipping.net in terms of the social and gaming components. Most other coupon sites simply post most, if not all, coupons that fall into their inbox, creating an obstacle for the consumer to find the deal they will most likely use. We look for the best deals on the web, and then let the consumer determine the value of that deal. Did the coupon work? Did it save you money? How was the website experience? Would you recommend it to others? The interaction within the site allows consumers to make an impression and voice opinions while obtaining information from others about deals, coupons and other ways to save.
SUB: What differentiates FreeShipping.net from the competition?
Caporaso: We find a lot of coupon sites are generally overly-crowded web pages and difficult-to-navigate experiences. So, we wanted to create an elegant and simple way to find the best coupons on the web and we believe we have accomplished this with FreeShipping.net.
We stand out from the status quo coupon and deal websites by making the process fun and social. When we started building the product the holiday season was approaching—the site is a direct response to consumer demand for more engaging and easier ways to save money while shopping online.
SUB: When was the company founded and what were the first steps you took to establishing it?
Caporaso: Clarus Marketing Group, the company behind FreeShipping.net, has been around for about 10 years. Founder Vincent Villano purchased the flagship URL, FreeShipping.com, in 2001, with an initial public launch in early 2002. The site was a response to the consumer pain of paying shipping charges on online purchases. With a subscription-based product background, he knew he could build a great product that would benefit consumers as well as alleviate the financial burden websites face by offering free shipping.
Clarus Marketing Group is your quintessential startup love story. The company started in our founder’s extra bedroom then moved to a more luxurious spot: the garage. The next big move was to an office space above a local deli called Chicken Cutlet. They never needed a clock to keep time because you could always tell when it was lunchtime from the smells of the deli below. In 2011, Clarus Marketing Group moved to an official office space in Middletown, Connecticut. Now with almost 25 employees, we still like keep the startup feel making it an open, creative and employee friendly space. At Clarus, we know about hard work and our competiveness is what keeps us in the game with larger Internet companies. That competiveness also comes in handy during our random in office putt-putt tournaments or company-wide Whirleyball games. If you have never seen 25 competitive people in bumper cars with lacrosse sticks trying to make a basket with a softball-sized whiffle ball, let me know—I’ll invite you to the next outing.
SUB: What was the inspiration behind the idea for FreeShipping.net? Was there an “aha” moment, or was the idea more gradual in developing?
Caporaso: The team at Clarus Marketing has been building subscription-based innovative consumer products for 10-plus years. Our focus has always been on easing pain for consumers and when we looked at the coupon space we saw nothing but obstacles. So, we focused on these key pain points and built out the experience.
Development was definitely more gradual as we had to identify each negative point associated with online coupons and how best to alleviate that pain. We also needed to understand current consumer behavior in the coupon space and how we were going to make FreeShipping.net different from other couponing sites out there. We knew it needed more than just savings to entice online shoppers so we incorporated the gaming and social elements.
When we started looking into gamification, we knew it would be difficult to build so we decided to partner with Badgeville who did a lot of the heavy lifting in the social and gamification aspect of the site providing us the opportunity to focus on what we do best: saving consumers money.
Plugging in the Badgeville service allows us the flexibility to cater to the engagement goals we want to encourage.
SUB: I know it’s early, but what have the most significant obstacles been so far to building the company?
Caporaso: The biggest obstacles are ones I think most Internet companies face: increasing traffic flow to the site and getting our brand out there. The Internet is a convoluted space filled with information and never ending offers of how to save money on online purchases. Succeeding in such a crowded and competitive area calls for aggressive marketing and PR tactics, along with keeping our products fresh and innovative. That’s what we do best so it’s all about executing on our strategy at this point.
SUB: You officially launched at the tail end of last year—why was this the right time for your public launch?
Caporaso: What better time to launch a coupon site than in the midst of the busiest shopping season of every year? We wanted to be present in the heat of the holiday season and let shoppers know we are out there and by launching our beta site then, we accomplished that.
SUB: How has the company been financed to this point?
Caporaso: Our founder, Vincent Villano, purchased the flagship URL, FreeShipping.com in 2001. The company was completely boot-strapped until early 2011, when Norwest Venture Partners, a leading global investment firm based in Palo Alto, took an interest and invested in Clarus Marketing.
SUB: Do you plan to raise more outside funding in the near future?
Caporaso: No.
SUB: What are your goals for FreeShipping.net over the next year or so?
Caporaso: The coupon space first and foremost is all about delivering great deals to the end consumer. However, we believe there’s a lot of room to not only do that but deliver a more engaging and useful product while providing a robust community that rewards a variety of different behaviors.
Another goal would be for the site to essentially become purely consumer driven and operated. All we need to do is provide them with coupons, and then based on their votes they decide what goes or stays causing us to add similar deals. From there, the cycle continues.
Just like any other Internet startup, we ultimately want to grow our user base. To do that, we are totally focused on delivering a successful consumer experience. To steal the “Field of Dreams” concept: Build a great product and the consumers will come.
