A COVID-era app to help Blacksburg businesses has endured and morphed beyond the pandemic era.
Localyte, a free local directory that features gift certificate and ticket-sales options, is growing beyond its early boundaries. Its originators say that they hope the app will soon reach statewide. But Localyte’s central goal remains the same: Shop locally.
“As the number of businesses has been growing, the number of users has been growing, which in turn, gives the businesses more reason to use the app to engage the consumers,” Localyte co-founder Jeff Werner said. “And so this is kind of a way where we’re really trying to compete for attention more so than dollars, because if we can have people think about the app … when they’re interested in buying something, instead of sitting down and going to a typical global e-commerce site and spending all their money there before they even leave the house, that’s kind of our intent right now, is to build the market around that concept.”
By mid-November, about 3,000 people had downloaded the app, and about 400 businesses had signed up, most for its directory feature. Localyte has businesses as far south as Galax, east to Appomattox and a few just across the West Virginia border, along with shops in Blacksburg, Salem, Vinton and Roanoke, Werner said.
Werner pitched the idea to a company co-founder, former work colleague David Carter, and by the end of 2019, they had enlisted two other partners for an application centered on a local marketplace directory. (Three other partners have joined in the years since, Werner said.)
With the 2020 lockdowns came a cash-flow problem for small businesses, they realized, and it inspired action from the Localyte principals.
“If you’re a global e-commerce site, you’re still making a ton of money,” said Werner, whose day job is senior vice president for EOS Network Foundation, a blockchain company. “In fact, in retrospect they actually made a killing … and I’m not saying that there was anything nefarious about it or anything, it’s just how it kind of played out. And small businesses didn’t have the capability to take advantage of essentially remote shopping.
“So we immediately pivoted to a gift card app. The idea was that people can buy gift cards now. They would have a year and a half or two years to [redeem them], then come back to the stores later. So the cash would go to the stores immediately.”
Localyte signed on about 25 local businesses in the early going, and it was selling enough gift cards that the partners felt like they were on to something, Werner said. As the lockdowns eased and the pandemic made the first of several retreats, folks were able to visit stores and restaurants again, but the Localyte team believed its service remained valuable. In fact, buying locally could cause a ripple effect that wouldn’t happen with monolithic e-commerce, Werner said.
“I go online. I buy something. I spent 10 bucks there. I would have spent 11 bucks at the local store. Look at me: I saved money,” he said. “And nobody’s thinking about, well, the profit margin for the local store stayed with the local owners, which means they’re going to turn around and buy something else. And the local municipality is collecting taxes on all of that. So the municipality gets to, like, put in a new kid’s playground.
“With the e-commerce site, all of that profit disappears, right? It goes first and foremost to the corporate offices, and then through a whole bunch of middlemen. It then gets distributed to shareholders, who are not going to generally live in the local area.”
Our Daily Bread Bakery and Bistro in Blacksburg was among the first businesses to sign on and offer gift certificates through Localyte. Co-owner Jen Morrison said that redemptions tailed off after an early push in 2020 that netted the eatery at least $100, and the business hasn’t seen much action there in about a year. She was considering making another push this holiday season.
“We still support the effort to promote local shopping, and look forward to seeing growth on the platform,” she said via email.
The app’s developers were working in November and December to upgrade the interface for the stores, with emphasis on searching by categories and filtering by gift card availability, Werner said.
Early on, Localyte initiated a partnership with the Virginia Tech Parents group on Facebook. It’s an invite-only group, which Werner and his colleagues were not allowed to join, but they worked with moderators to market Localyte to the parents. The idea was that parents could buy gift certificates for their kids at VT, with the “buy for a friend” option.
That helped ensure that gifts would be what the parents preferred, Werner said.
“We would even joke with the moderator, that … you’re not basically funding your kid to go buy a case of beer or something,” he said.
They surveyed businesses to learn what more they could provide from the site and learned that some wanted to sell tickets to their events. So far, about 35 businesses have buttons to sell gift certificates or tickets. Localyte keeps 2% of the transaction cost, Werner said. Signing up for the directory is free. Werner declined to discuss how much the team spent to build the app or how much it has made since then.
Winterfrost Farm, a Radford-based nonprofit horse-rescue organization, has been on the app for two years. The organization used it to sell tickets last year and this fall and winter for trail rides at a Christiansburg farm’s pumpkin festival. Winterfrost’s Reagan Miles said the process has been “really pretty smooth” and allows Winterfrost the ability to communicate with past customers.
“I think overall … the program has been quite amazing and super easy to do,” Miles said. “I’ve been super impressed with them and … we’ve worked with a couple other companies … things like Groupon and a couple other things like that and, by far, [Localyte is] probably the easiest one that I think we’ve ever worked with.”
None of the Localyte developers are quitting their day jobs just yet, but they are enthusiastic about the app’s potential. Angela Dickerson, customer experience manager for blockchain company Bullish, based at the Virginia Tech Center for Corporate Research, is doing the same work for Localyte. Dickerson said that she reached out to Werner about joining the team because she prefers a local shopping experience.
“If people are sincere about supporting local businesses, this is an easy way to do it,” said Dickerson, who is also president of the Blacks in Technology Roanoke-Blacksburg chapter. “This is really a passion for folks. … We’re in it together. And I encourage people to encourage others to sign up their local businesses.”
On the web: localyte.com. By phone: use browser to visit localyte.app.link or download it via Apple’s App Store or Google Play Store.
