Business considerations — Lantern

Summary

This document collects monetization options, example offers, product/technical requirements, privacy & legal considerations, sample APIs, a merchant onboarding checklist, a pricing template, and a recommended pilot plan. Use this doc as the single source of truth for merchant-facing features and early monetization experiments.

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Pilot Context — San Diego 🌴

Location: San Diego, CA
Lead: Web/app analyst (YouTube background) with web design expertise
Co-founder advantage: Partner in service industry with established venue relationships

Strategic advantages:

• Industry insight into merchant pain points, operational workflows, and competitive dynamics
• Direct on-the-ground access to early merchant conversations and beta testing
• Service industry connections lower customer acquisition costs (CAC) and improve trust
• San Diego's vibrant hospitality and retail scene provides diverse venue types for testing

Pilot scope: Test with 5–10 initial merchants in San Diego (cafés, bars, retail) over 60–90 days. Validate offer efficacy, merchant willingness-to-pay, and user engagement before geographic expansion.

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TL;DR recommendation ✅

• For the pilot, prioritize Flat‑fee campaigns + Pay‑per‑checkin (PPC): flat fees are simple to sell and implement; PPC proves direct value and supports pricing refinement. Start small (5–10 merchants) and test both models side‑by‑side.

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Monetization options — full list 🔍

For each option below: What it is, pros, cons, complexity, and pilot fit.

1. Sponsored pins / promoted listings 📍

• What: Merchants pay to appear above organic search results or in discovery feeds.
• Pros: Easy to explain and sell; immediate merchant value; low friction to implement.
• Cons: Needs ranking fairness and limits; risk of cluttering UX.
• Complexity: Low → Medium
• Pilot fit: Excellent

2. Pay‑per‑checkin (PPC) / pay‑per‑redemption 💸

• What: Merchant pays only when a verified check‑in results in a redemption.
• Pros: High ROI signal; attractive to merchants who want measurable outcomes.
• Cons: Requires robust verification to prevent fraud; more complex billing/attribution.
• Complexity: Medium → High
• Pilot fit: Strong

3. Flat‑fee campaigns / time‑boxed promos 🗓️

• What: Fixed price for a campaign window or set of impressions/check‑ins.
• Pros: Predictable revenue; simple sales; easy to onboard merchants.
• Cons: Harder to prove direct ROI compared to PPC.
• Complexity: Low
• Pilot fit: Very good

4. Merchant subscription (SaaS) — dashboard & analytics 📊

• What: Monthly/annual subscription giving merchants access to a dashboard, analytics, and advanced targeting.
• Pros: Recurring revenue; upsell potential (tiered features).
• Cons: Requires product polish and ongoing support.
• Complexity: Medium → High
• Pilot fit: Post‑pilot (once product-market fit is validated)

5. Event / ticketing marketplace fees 🎟️

• What: Facilitate event listings and ticket sales and take a transaction fee.
• Pros: High per-transaction value; attractive to event venues.
• Cons: Refunds/chargebacks and marketplace complexity.
• Complexity: High
• Pilot fit: Good for event-focused merchants later

6. Affiliate / revenue share on tracked purchases 🔗

• What: Track purchases following check-ins and split incremental revenue with merchants.
• Pros: Aligns incentives; can be lucrative.
• Cons: Attribution complexity and privacy implications.
• Complexity: High
• Pilot fit: Advanced stage

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Example offer & flow (copy + verification) 🔖

Offer example: "Buy one drink, get a second 50% off when you check in on Lantern."

Flow:

• Merchant creates offer: title, short terms, start/end, geofence (lat/lon + radius), per-user limits, max redemptions.
• User sees the offer when nearby or in place details; they check in at venue → eligible offers appear.
• User taps "Redeem" and receives a one-time coupon code or redemption token.
• Merchant verifies via QR scan, one-time code, or merchant dashboard confirmation.
• Server verifies check-in timing, geofence compliance, and per-user/campaign limits before marking redemption.

Fraud prevention: combine GPS geofence checks with short time windows and optional QR for mandatory in-person redemptions on high-value offers.

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Data model & offer schema (suggested)

{
  "id": "uuid",
  "merchant_id": "uuid",
  "title": "Buy 1 get 1 50% off",
  "description": "When you check in...",
  "start_time": "2026-01-01T16:00:00Z",
  "end_time": "2026-01-03T02:00:00Z",
  "geofence": { "lat": 40.7128, "lon": -74.0060, "radius_m": 100 },
  "per_user_limit": 1,
  "max_redemptions": 200,
  "code_type": "one_time",    /* one_time | auto | manual */
  "status": "active"
}

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API examples (sample request / response)

POST /merchant/offers (merchant-auth) Request body (JSON):

{ "title":"BOGO drink 50% off", "start_time":"2026-01-01T16:00:00Z", "end_time":"2026-01-03T02:00:00Z", "geofence":{...}, "per_user_limit":1 }

Response (201):

{ "id":"offer_abc123", "status":"active" }

GET /places/:id/offers Response (200):

{ "offers": [ { "id":"offer_abc123", "title":"BOGO drink" } ] }

POST /places/:id/checkin (user-auth) Request: { "user_id":"u1", "place_id":"p1", "lat":.., "lon":.. } Response:

POST /offers/:id/redeem (user-auth) Request: { "checkin_id":"c1", "user_id":"u1" } Response:

GET /merchant/reports?campaign=offer_abc123 (merchant-auth) Response: impressions, checkins, redemptions, redemption_rate, revenue, cost

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Merchant onboarding checklist ✅

• Create merchant account (email + verification)
• Add business details: name, address, hours, place_id or map pin
• Verify ownership (email/phone + optional manual review)
• Payment setup (Stripe account connect or payment method)
• Create first offer (use template: BOGO, % off, time-limited)
• Soft launch: test redemptions with staff and verify QR / code flow
• Go live and set reporting cadence (weekly CSV export)

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Sample pricing templates (starter)

• Flat campaign (starter): $99 for a weekend campaign (Fri–Sun) with up to 5,000 impressions. Extra impressions $0.02 each.
• PPC (starter): $1.00 per verified redemption / check-in (volume discounts applied above 100 redemptions).
• Subscription (tiered): Basic $29/mo (listings + 1 campaign), Pro $99/mo (dashboard + analytics + 5 campaigns), Enterprise custom.

Notes: use pilot to validate these numbers and run A/B pricing with merchants.

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Fraud & abuse mitigation 🔒

• Geofence + timestamp verification for check-ins
• Optional QR / one-time codes for in-person validation
• Rate limits and per-user per-campaign restrictions
• Heuristics (same device/multiple accounts, improbable GPS patterns)
• Manual review & dispute workflow for merchant chargebacks

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Privacy, legal & safety ⚖️

• Explicit opt-in for location-based offers; clear privacy disclosures in-app
• Label sponsored content clearly (e.g., "Sponsored")
• Keep PII minimal; use hashed identifiers and short retention windows for location data
• Merchant terms of service (promo rules, liability, refunds)
• Consider GDPR/CCPA compliance and local promotional laws

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UX guidelines ✨

• Always label sponsored content and provide an easy opt-out
• Keep offer cards concise: title, short terms, CTA (Redeem), distance/time
• One‑tap redeem with clear merchant verification step
• Notifications must be opt-in, with frequency controls

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Metrics to track (pilot & ongoing) 📊

• Impressions, clicks, check-ins, redemptions, redemption_rate
• Revenue per merchant, ARPU (merchant), CAC & LTV
• Fraud rates, dispute rate, chargebacks
• Merchant satisfaction (NPS) and retention

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Pilot plan — 60–90 days 🚀

1. Recruit 5–10 local merchants (mix of cafés, bars, small retailers). (Week 0)
2. Implement minimal merchant dashboard: create offer, view redemptions, download CSV. (Weeks 1–3)
3. Launch two pricing tests: Flat campaign (offer A) vs PPC (offer B). (Weeks 4–6)
4. Collect metrics: impressions → check-ins → redemptions, merchant feedback, operational issues. (Weeks 6–12)
5. Iterate on verification, fraud rules, pricing. Prepare for small scale-up. (Weeks 12+)

Success criteria for pilot:

• At least 50 verified redemptions across merchants
• Merchant satisfaction >= 70% and willingness to pay again
• Fraud rate < 5% of redemptions

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Next steps & priorities 🔜

1. Add detailed API endpoints & error codes to BUSINESS.md and create an API.md (if desired). (Priority)
2. Build minimal merchant dashboard and fundraising/merchant outreach plan. (Priority)
3. Wire up billing (Stripe Connect) and basic reporting. (Priority)
4. Run pilot and collect metrics; iterate based on data.

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This file is a living document. Suggest additions, local regulatory notes, or promo ideas and I’ll update it.