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BrownPaperBag, which was founded by Kanika Parab and Mansi Poddar three years ago as a weekly newsletter for interesting things to do in a city, curating and recommending restaurants, events, shopping, travel, and services, among other things, appears to have found an ideal mode of monetization via a loyalty card: called the Coup Card. “The coup card was our way of taking our curation power offline. We do a lot of discounts and deals exclusively for BPB subscribers, and collaborate with restaurants anyway”, Parab told MediaNama.

The Coup Card is available for six months (Rs 2100) or a year (Rs 3800), and allows those to purchase it to get a flat 15% off on food and alcohol on 20 of BPB’s select restaurants in Delhi and Bombay. The one year card allows an additional cross-over between Delhi and Mumbai. Parab says that what differentiates the Coup Card from other loyalty cards are three key things: that the discount is ubiquitous, which means that it includes buffet’s, happy hours and alcohol; that it is a flat 15% off, and doesn’t vary depending on the restaurants; more importantly, it has restaurants which don’t usually give discounts; for example, Delhi has Olive, Ploof, TLR, Elma’s, Flavours, Shiro, Mamagoto, among others, while Mumbai has Indigo Deli, Ellipsis, Jamjar Diner, Mamagoto, Busaba, among others.

The newsletter has 60,000 subscribers in Mumbai, and 25,000 in Delhi (launched a little over a year ago).
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On Restaurant Relationships

So why are these restaurants partnering with BPB? Parab says that they’ve built relationships with restaurants through their newsletter over the years: “These restaurants have been written about by us, and they know the target audience we’re driving to their restaurant. It was quite simple for us to get these restaurants on board.” The idea for the loyalty card came from BPB’s business head Akshat Poddar, Parab adds, also emphasizing that they don’t monetize the card from the restaurant side, because they want to make sure it isn’t a biased list. “We don’t do editorial for them – we’re very fiercely protective of that. It’s not like we’ll give them a good review. These restaurants are, to begin with, places that we love, and places that we’ve reviewed before on the website. It’s also easy for them – they don’t need any tech – it’s not a swipe card. We have a 24 hour hotline for them, if there is any issue with the customer.”

The Coup Card has been restricted to only 20 restaurants in its second iteration, unlike other loyalty cards which offer hundreds of restaurants. Parab says that they wanted to make the card clutter free, and not force people to sift through a list. “It’s a list of 20 restaurants worth visiting in Bombay, and we don’t want restaurants that are on every other deal site. The card is good value for money, but it’s also expensive, so we don’t want to risk losing exclusivity,” she adds.

So what happens when the Coup Card drops a restaurant from its list? “There were a few restaurants like The Table, which is a really high end restaurant at Colaba, and we decided that we’ll do Ellipsis instead this time. People who were regulars at The Table were disappointed. Restaurants were not disappointed, because we sign them up for six months, so then there is no real commitment that we will sign them back, or they will sign on again.”

Update: A clarification from Kanika Parab from Brown Paper Bag: “”This is to clarify that it was The Table that decided to sit out Round II of the Coup because they’re expecting higher traffic due to the upcoming busy season.”

Coup Card is also limiting the number of customers – to 1000 each in Delhi and Mumbai. At the time of writing this post, the Delhi card is already sold out, and on a wait-list. “We’re limiting the number of customers because we want it to be exclusive. It’s comfortable for restaurants to know what we’re not just flooding the market, where there are hordes of people coming in with 15% off. That does limit the scale that we operate with, but we’re trying to scale up in terms of cities, and other iterations.

Other Types Of Cards & Going Digital

The Coup card has launched an iteration – there is a mini coup card which is available for one week, for travelers going to Mumbai or Goa. It’s issued as an e-card, using Passbook (on iOS) and Passwallet (on Android). Another iteration of this will be, that people will get pinged when they pass by a coup-card restaurant.

Another iteration will be a corporate card: the current annual card offers a Mumbai-Delhi crossover, and this works particularly well for corporates. It’s easy to get restaurants on board for them, and it also works as a corporate gift for clients, as opposed to tickets for a Cricket match, Parab claims.

Beyond Restaurants

“Some of the categories that we can add have to do with shopping and retail. We’d love to do events, but the problem with that kind of thing is that gigs are not fixed, so it’s hard to get people to put in money first, and they don’t know what they’re buying. If you look at fashion stores, there’s a dearth of fashion stores. We can think of barely 5-6 places. Plus, their rentals are high and margins are very different. So a 15% off is not easy. We don’t want to make it 10%, because that isn’t enough – it isn’t incentive enough for people to buy the card – or for it to be one of those cards that offers different discounts at different places. We are exploring other areas, but are trying to figure out how to do it best”, Parab says.

Quick Take

In an era where advertising really doesn’t do justice to the monetization of a premium online audience, BPB’s approach via a loyalty card is a very interesting one. Another company which has a similar opportunity is, quite clearly, Zomato: it may not have the same type of niche audience that BPB has, but it does have the base, and the opportunity to offer segmented cards (separate for bars, tiered restaurants, and for different cities.