A daily deal website called Groupon started up in Chicago in November 2008 with little fanfare. By the next month, it reportedly had 400 subscribers, not exactly a web titan.
But within two years, Groupon had grown so large that its proprietors decided to turn down a $6 billion buyout offer from Google. Forbes has called Groupon the fastest growing company in U.S. history, basing its report on a study that determined the web enterprise was on pace to reach $1 billion in sales faster than any company ever.
The three entrepreneurs behind Kalispell-based Eponme aren’t claiming to be Groupon, nor do they want to be in terms of specific philosophy and strategy. Eponme is, however, a “deal of the day” website like Groupon, so the company’s creators can take comfort in knowing that their basic business model has been – in a big way – proven.
Since launching on Aug. 4, Eponme has enjoyed a quiet yet fairly fruitful grassroots following. Their voucher for a deal at North Bay Grille offering $40 worth of food for $20 was purchased by 45 people, leading to more than $1,000 in sales for the restaurant, according to Eponme co-owner Mark DeLorme.
As of the middle of last week, DeLorme said Eponme had about 500 people subscribing to its daily email listing the deal of the day. But with interest growing quickly, and a plan to send out 113,000 promotional emails to people throughout Northwest Montana, DeLorme sees considerable growth in the near future.
“We feel that it’s going to be close to 5,000 subscribers in six months, when the fire catches,” he said.
DeLorme, the former owner of Spirit Skate Shop, is one of three partners in Eponme, along with the company’s financial specialist, Ethan Golf, and the head chef and acting general manager of North Bay Grille, Zach Bernheim. The three owners spent several months preparing for the launch, formulating their business plan and carefully selecting web experts to ensure the quality of their site.
Eponme is part of a new and rapidly growing form of e-commerce that allows businesses to post specific deals without paying money upfront while email subscribers are privy to the new deals immediately as they’re offered. Along with Groupon, LivingSocial out of Washington D.C. has become a major player in e-commerce with more than 40 million members.
At Eponme, a business owner signs a service agreement to advertise a special deal at no cost on Eponme’s site. Through social media, word of mouth and traditional advertising sources such as billboards and newspaper advertisements, Eponme promotes its site and the deal.
When a member – who has signed up for free – purchases a voucher for the deal, the business and Eponme each receive an agreed-upon percentage. Then the business often earns additional profits when the purchaser redeems the voucher.
For example, in the case of North Bay, Bernheim said most people spent well beyond the $40 listed in the deal. Armed with a $20 voucher, many decided to upgrade to a nicer bottle of wine and splurge a bit overall, making the deal even sweeter for North Bay.
“It’s no-risk advertising,” Bernheim said.
All deals on Eponme are for 50 percent off or more. So far, other examples have included $12 for a $25 haircut at Shorty’s Barbershop, $10 for a $30 gym membership at Access Fitness and $20 of food and coffee at Spill the Beans Espresso for $10.
A deal is posted for 24 hours, from midnight to midnight, and then a new deal is promoted on the site, except for longer display periods on weekends from Friday to Sunday. Once deals are expired they are no longer available for purchase.
Another advantage for businesses, Eponme’s owners say, is the ability to track each purchase. Business owners know exactly how many deals are sold through the website, as counted by a ticker. In traditional marketing formats, it’s difficult to gauge how many customers can be directly attributed to a specific advertisement.
Both DeLorme and Bernheim emphasize the words “grassroots” and “community,” seeing their company as a way to help both businesses and consumers while keeping money within the local economy. Eventually, the owners want to take Eponme into other markets across the state and beyond.
“We’re a local company that cares about where people spend their money and we want to see the money reinvested locally,” DeLorme said.
“We’ve got a good product,” he added. “In the end, we’re just excited to have this product and we feel we can really take it somewhere.”
For more information, visit www.eponme.com.