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Ox & Pen Heats Up Competition in Crowded Customer Loyalty Market

By Alisa Hauser | November 6, 2012 8:46am

CHICAGO — Ox & Pen, a new customer loyalty program is building a following among merchants citywide. 

The company's founder and CEO Andrew Gluck, who oversees nine employees said he does not feel like daily deal companies such as Groupon are creating an equitable relationship with small businesses.

"We do not get paid until business occurs, and we want to encourage full-priced repeat return customers," Gluck said at a Friday night recruitment social at The Silver Room in Wicker Park.

Ox & Pen, which had 120 businesses signed up by early November, is different than Groupon, which takes 50 percent of sales, in that its take is "in the single digits," Gluck said.

It is also is unique from other programs because it's strictly for local businesses without upfront costs to merchants, he added.

"Shopping local has become trendy these days, but there's reasoning beyond it. It makes economic sense," Gluck said. "Small locally owned and operated businesses pay more taxes directly back to the community. The community doesn't see as direct a benefit with a Starbucks as a mom-and-pop cafe."

Linda McGuire, owner of the boutique Futurgarb, at 1369 N. Milwaukee Ave., just signed up for Ox & Pen and said that close to 15 percent of her sales come from customers that use mobile or app-based loyalty programs, such as Scoutmob.

"As a business you just want to bring people into your door. There are people that search out these kinds of apps and are looking for deals," she said.

Ox & Pen offers consumers three ways to rack up reward points: by "checking-in," allowing your smartphone to share your location through GPS, sharing your experience on a social network, or making a purchase.

Christy Lukes, Ox & Pen's social media marketing manager, said that points can be used at any Ox & Pen merchants unlike other programs like Belly Up, which allow a user to redeem points only at the place they accumulate them.

Another differentiating point, at least behind the scenes, is more access to customer information through a dashboard that provides "rich data" along the lines of who came in, how much they spent and if they checked in.

Charlie Barone, general manager of West Town's Frontier bar and restaurant, told DNAinfo he does not log into his dashboard much, but that he works closely with his Ox & Pen rep to help drive awareness of a weekly Wednesday night 'Speakeasy' mixology event.