You may remember last year when Family Dollar introduced a new and improved app it said would “make shopping with us even easier and more enjoyable.” What it didn’t say at the time, was that the new app launched amid a financial dispute with the company responsible for its old app – a dispute which has now resulted in a federal lawsuit.
And it all comes as shoppers appear to have preferred the old app all along.
Before the app’s relaunch last year, Family Dollar owner Dollar Tree had partnered with the retail technology company Swiftly. In order to help promote the products sold in Family Dollar’s stores, “Swiftly agreed to provide Family Dollar with its services and technology to develop and launch the Family Dollar Application to promote the advertising of said consumer products to Family Dollar’s customers through digital discounts and coupons,” the retailer explained in a lawsuit filed last week. As part of their agreement, Swiftly would sell ads on the app and share the proceeds with Family Dollar.
When their three-year contract expired last year, Family Dollar chose not to renew and to launch a new app with a new provider. And now, Family Dollar alleges, Swiftly owes it at least $1,852,033 from their ad revenue sharing agreement.
In a statement to Coupons in the News, Swiftly said it “strives to maintain strong business relationships, accurately sharing revenue with every retailer on the Swiftly platform. While Swiftly respectfully disagrees with the claims made in the recently filed lawsuit, we look forward to resolving the matter through the legal process.”
Ultimately, this is a dispute that doesn’t directly impact shoppers and users of Family Dollar’s app. Except that many shoppers seem to have liked Swiftly’s version of the app better.
“This app worked perfectly, until they ‘New & Improved’ it. Now it doesn’t work,” one app reviewer wrote recently. “The newer app is horrible. Clipping a coupon is delayed, therefore clipping coupons takes forever. It’s no longer fun but frustrating,” another commented. “I miss the old app. Why did they have to mess up a good thing? Was so much faster,” a third reviewer wrote. “Way to go! You updated the app for it to take 10 mins to clip a coupon now,” another frustrated commenter wrote.
When announcing the new app last year, Family Dollar touted its “fresh interface and seamless navigation,” and said it would “help shoppers effortlessly manage coupons using the redesigned wallet feature, explore engaging weekly ads, and easily locate products with intelligent searches.” A few months later, Family Dollar revamped its Smart Coupons digital coupon program available on the app and on its website, by partnering with Ibotta. Instead of having to request cash back from Ibotta after making a purchase, Family Dollar shoppers can clip Ibotta-powered offers in the retailer’s app and save money on their purchases right at the checkout.
But the real motivation that Family Dollar and other retailers have to get you to use their app, is the ability to advertise to you. When you register with and use the Family Dollar app, the retailer knows who you are and what you like to buy. And that makes it easier for partners like Swiftly to sell ads that are uniquely relevant to you.
“Brands will be able to directly reach millions of families across America through a variety of digital options made possible through our newly-formed retail media network,” Dollar Tree Enterprise Chief Merchandising Officer Richard McNeely said, back when Family Dollar’s partnership with Swiftly was first announced. The platform, he said, would allow advertisers “to leverage dynamic ad placements, targeted content, sponsored searches, and product recommendations” tailored to each individual app user.
“This push into digital is more about developing media networks and driving advertising revenue than it is about customers,” retail analyst Neil Saunders of GlobalData Retail observed on the industry site RetailWire. “Family Dollar needed to jump onto this bandwagon,” analyst Dave Wendland of Hamacher Resource Group added. “Do I anticipate a significant return on this investment? Likely not. But without it, they run the risk of losing ground.”
So if the reviews from frustrated app users aren’t all kind, Family Dollar isn’t exactly losing sleep as long as the ad revenue keeps flowing in. And if at least some of that $1.8 million in dispute can be redirected toward more savings for app users – even better.
Image source: Family Dollar
