Small Business: Vippa's move to snatch share of social media giants' corporate accounts

Danny Yang, founder of software company Vippa. Photo / Supplied

Software company founder Danny Yang talks creating hybrid social media-cum-voucher platform Vippa, global competition and spending 60 per cent of the week on the business among his other consulting commitments.

What does your business do?

Vippa is a new social app platform for small business owners to set up digital loyalty programmes. It works by alerting nearby app users to put on a special or a message, users use QR codes to collect stamps and a newsfeed to post and tag favourite businesses to share their real experiences to support small businesses, and make loyal customers become more close to SMEs.

We have over 80 small businesses based in Auckland using the platform and we just reached over 1000 app users last week. We started working with cafes and restaurants because they have repeat and loyalty-based customers, then moved on to hair and beauty salons and convenience stores and we'll be moving into retail and fashion next.

What was the motivation for starting it?

I started research in early 2016, I wanted to understand what social media could do to support small businesses then along the journey I noticed that social media didn't really give anything and a lot of deal sites eat into profit margins so I wanted to change the way small businesses do marketing. I started building Vippa in 2018 to aim to promote an alternative, affordable solution to help local businesses so they can support their loyal customers. The app went live in March 2019.

I had other businesses that I wanted to reach my customer but I couldn't really find a platform or software that could allow me to do that and engage with them how I wanted to so my entrepreneurial side kicked in and I made my vision to create my own software to help my business and my friends' businesses.

How big is the team?

We have software engineers, graphic design and a sales team of five people.

How has the Covid-19 pandemic impacted your business?

Covid came just before Vippa was receiving revenue in April this year, and it has helped people to understand the importance of supporting local and gaining an understanding of using QR codes to record visits. We had growth between the two lockdowns as businesses felt they needed an extra helping hand to increase customer base after lockdown and app use picked up - we've seen a lot of positive results.

How much did you invest to start up Vippa?

Along the way we've invested between $200,000-$300,000 so far. Most of that has been spent on R&D to create the app and a small amount on marketing after the launch.

What are your long-term plans, where do you see the business in five to 10 years time?

We want to change the way we reach and engage customers so we want to have every small business in New Zealand to use our software and increase our market share to have at least half of all small businesses using our software. With customer uptake with the app, we hope to reach a level that we can compete with other competitors on the market.

Photo / Supplied

We have two types of competitors: all social media platforms and current deal sites that offer heavily discounted specials to one-off deal hunters.

How much opportunity is there is New Zealand's small business community?

Small businesses generate a third of New Zealand's GDP and hire a large portion of the population. If more people and small businesses join an app like this we can actually give them a bigger voice and reach more customers, more effective in a community base. We want to help businesses grow digital loyalty to in turn help the business grow. All businesses should make 80 per cent profit from 20 per cent loyal customers. Because this is a new platform and concept it is hard to put a value on it.

What advice do you give to others who want to start their own business?

Change the way you see the other side of the equation - businesses need to understand what the customers' needs are. Small businesses need to position themselves so that they are strong, different, have their own personality and outstanding in what they are offering.