LAS VEGAS--T-Mobile US (NYSE:TMUS) MVNO Solavei plans to launch a loyalty card program that will allow customers to obtain 2-15 percent discounts from participating retailers as well as additional savings through the company's tiered membership structure. Solavei plans to launch the offering sometime in September.
The Solavei Marketplace is launching in September.
The company also said it expects to generate $100 million in revenues during its first year of operations.
During a meeting here on the sidelines of the CTIA Wireless 2013 show, Solavei CEO Ryan Wuerch said that Solavei has already inked a deal with credit card transaction company First Data to power its forthcoming Marketplace service, and that a wide range of retailers including Ace Hardware, Walmart, JCPenny, Burger King, Outback Steakhouse and Kmart have already agreed to participate.
"These (retailers) will end up being partners of Solavei," Wuerch said.
Wuerch explained that Solavei already uses Solavei-branded Visa debit cards to pay membership commissions. (Under Solavei's service, customers who sign up three other people to the service receive $20 per month on their Solavei Visa card.) In September, Solavei plans to add a coupon and loyalty layer into those Solavei-branded debit cards. The program will give 2-15 percent cash back to members who spend money with participating retailers using the Solavei debit card. Retailers will pay to participate in Solavei's Marketplace and Wuerch said that 50 percent of those payments will be distributed into users' networks (meaning, to users and the other customers they have signed up to Solavei).
Wuerch said that Solavei members will be able to view participating retailers and specific discounts on Solavei's Marketplace service--similar to how Groupon users can view discounts and coupons--and Wuerch said the Marketplace offering will be built into Solavei's existing online customer service system. Interestingly, since the Marketplace service will be tied directly to Solavei's mobile service, users will receive text alerts on their phones when they spend money at participating retailers informing them of the discounts they have obtained through the Marketplace service.
"This is so much stronger than a Groupon," Wuerch noted, adding that Solavei customers will be able to sign on smaller, local retailers to the Marketplace service themselves. "It's so much more than a mobile phone."
Solavei's Marketplace plans represent the next major phase of growth for the company, which Wuerch likened to Amazon. Wuerch explained that Jeff Bezos launched Amazon as an online distribution company that initially focused on selling books. Similarly, Wuerch said Solavei launched initially selling mobile service, but will over time expand into a variety of new markets and services with the goal of saving its members money.
Separately, Wuerch provided an update on Solavei's progress in the eight months since it launched. He said the company currently counts 180,000 members, of which 100,000 are considered "active" users (those who remain active after 2 months of service). Wuerch said the company has paid $10 million in membership commissions since it launched in September. Importantly, Wuerch said Solavei is on track to generate $100 million in revenues in its first full year of operations.
Wuerch also said that Solavei has been successful in luring customers away from some of the major wireless carriers. Specifically, he said that 78 percent percent of Solavei's customers are new to T-Mobile's network, meaning that they were previously customers of Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T) or another T-Mobile rival and churned onto Solavei's service.
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