Thursday, June 14, 2018
Interview with Oded Vakrat, Earny
For most consumers with a credit card, many of those cards have a feature called "price protection"--which promises to provide you with cash back if prices drop on an item you've purchased. But, how many people actually bother to submit for those refunds and follow prices after you purchase an item? The solution: Los Angeles-based Earny (www.earny.co), which has created a service which automatically submits for those refunds and price adjustments for you. We caught up with Oded Vakrat, CEO and Chief Product Officer (CPO) of Earny, to learn more about the service and his startup journey.
What's Earny?
Oded Vakrat: Earny is a personal assistant. We give consumers money back when prices drop post-purchase. For example, you might purchase a TV from Amazon, and pay $1000, and the price drops to $800 a few weeks later, and we make sure you receive $200 back. Everything is fully automated, and we work directly with retailers and credit issuers to get you that difference back.
Explain how that price protection works?
Oded Vakrat: Retailers usually offer 30 day price protection, and on top of that, most credit card issuers offer up to 90 days of price protection. We're talking about two different policies, under the same name of price protection and price matching. They are trying to give you the confidence to shop, with the promise that you can buy whatever you want, and if the prices drop they will refund you the difference. The problem is, even though these policies have been available in the market for the last few years, it's very difficult to take advantage of price protection, because consumers are often no even aware of those policies, and the terms. Even if you are familiar with price protection, often times you don't want to waste time looking for cheaper prices, and submitting those claims to the credit card companies. We've measured that it takes about 45 minutes to submit for a price adjustment claim. We decided three years ago, to make the mission of automating that price protection, and get consumers money back automatically. What we are doing is giving consumers confidence to shop, which primes them to buy what they want, and at Earny we'll ookifor the best prices during the next 90 days so they don't have to worry that they paid too much. So far, we're getting consumers millions of dollars back.
What's the reaction to an automated service by the retailers and credit card issuers? As a consumer, we might worry they might feel as if you're abusing their system?
Oded Vakrat: Most of the retailers and credit card companies are actually able to measure the positive impact that we drive on their end. We see, from our discussions with them, that they are seeing consumers switching their payment methods to their credit cards, specifically based on those price protection policies. They've seen hundreds of thousands switch their credit cards, in order to shop with a price protected credit card. The issuers also saw that consumers were spending about 30 percent more when they knew they could get money back from Earny, from those price adjustments and refunds. Plus, we see consumers are returning less items because they are more satisfied with their purchases. If you think about it, that post-purchase stage is when consumers decide if they are satisfied with their purchases or not, and we see that when consumers are getting money back, they return less items, and their experience with retailers are way more positive than before. In terms of loyalty, retention, and engagement, we see a significant lift in consumer satisfation, and consumers are buying more, and spending more, and are getting emotionally connected to brands because they trust those brands, because they know Earny can get them money back if prices drop.
How do you get access to the information on a consumer's transactions?
Oded Vakrat: When a consumer registers with Earny, the can download our app, or register on our website. They then register with us, and give their email provider permission to give us access to a cop of their receipts. When you buy something at a retailer, say Walmart, they send you a receipt, and we get a copy. That's how we can track your purchases, without you having to forward every since receipt or take pictures. Once it's in our system, we will monitor priecs for 90 days, and when prices drop we either email the retailer you purchased from on your behalf, or we will go and claim that difference from the credit card company. Of course, users also need to enter their payment method into the app, so we know what credit card they are using.
Let's talk a bit about your funding and investors. How are you funded?
Oded Vakrat: We've raised $11.6M in total from top tier VCs, including an investment from Science Inc., the leading incubator here in LA, as well as investments from Mayfield, the firm which was the lead investor in Lyft. We also have on baord Comcast Ventures and a few other angel invsetors, who are very helpful and dedicated to our mission.
What were you doing before, and how did you get into this?
Oded Vakrat: A little bit about myself. I am originally from Israel, and grew up there, and served in the Israeli Navy for eight year, with my co-founder and COO, Dori Yona. We were both Naval Academy officers, and commanders of combat ships and platoons of ships. We both managed more than 500 soldiers during our time in the Navy. And, we we always knew we were going to build companies together. We were both very attracted by invention and technology. When we both moved to the United States about three years ago, we became familiar with price protection. I'm the product person, and am very product oriented. I received $65 from Chase from price protection, and we immediately asked ourselves, why has no one automated price protection in the past? We put it as our mission to automate price protection for consumers, so that price protection would become a little more accessible for consumers. That's when we started. We took some money from amazing investors, hired amazing team members, and since then have been growing the team and scaling the product, and reaching out to more and more consumers to help them get their money back.
What's the biggest lesson you've learned as an entrepreneur?
Oded Vakrat: When you provide consumers with a great product that they really appreciate, care for, and trust, that's the most important mission you can accomplish. Someday, it will pay off. I have to tell you, consumer advocacy is not easy, and it's very hard to sometimes convince brands why they need to give consumers their money back. But, we truly believe that if these brands offer customers specific benefits, those customers should be able to take advantage of those benefits. In this case, that they should receive money back when prices drop.
Thanks, and good luck!