Colu and Tel Aviv Municipality Create a Winning Program
- Wealth Management
- 03.12.2019 04:54 am
Colu, a city app and digital wallet solution for smart cities, partnered with Tel Aviv Municipality and the Tel Aviv Foundation, aiming to develop financial tools to strengthen urban resilience, drive consumers to shop at stores cut off from traffic by the city’s train construction.
When 230 small businesses on Tel Aviv’s Jerusalem Boulevard were cut off from traffic due to light rail construction, business owners took to the streets, protesting the city project. With 5 stores closing each week, and the project is expected to last for 3 more years, store proprietors demanded a solution before the entire shopping area disappeared.
Colu introduced a cashback program for the troubled area. Funded by the city, residents, and visitors to the area who used the Colu app received a 30% rebate on purchases made at participating shops. The rebate could be spent at any Tel Aviv retailer who was part of the Colu network, ensuring the money stayed in the Tel Aviv community. This helped spread the city’s investment beyond the troubled Jerusalem Boulevard area, to support small businesses from across the Tel Aviv area.
The pilot program, which was funded by the Tel Aviv Municipality and implemented through Colu’s app, has been a success. Between September 27 to November 15, 2019, Colu drove over $550,000 into area businesses, with over $150,000 in subsidies coming from the municipality. According to store-owner reports, revenues, which had dropped by 30%, returned to pre-construction levels.
“The Colu program saved the businesses on Jerusalem Boulevard,” said Noa Mondshein, owner of Noa, custom brass store and one of the leaders of the protests. “They showed us the power of a community coming together and how a city can take care of its residents. Colu helped drive new, Millennial customers into the neighborhood stores. The result was an increase in my cash flow, giving my business hope for 2020.”
Colu’s app drove over 4,000 users to the Jerusalem Boulevard area, 70% of whom hadn’t shopped there at all during the previous 3 months. Those shoppers completed over 23,000 transactions during the pilot period.
“At Colu, we’re focused on helping local economies thrive,” said Amos Meiri, co-founder, and CEO at Colu. “In Tel Aviv, we recognized an opportunity to implement our technology to help area businesses. Through the power of our app, the resilience of the Tel Aviv business community, and the willingness of residents to venture into challenging retail areas, we helped prop up an area that was experiencing very difficult issues.”
For the Tel Aviv Municipality, Colu was instrumental in opening lines of communication with area business owners and building trust. They took an urban regeneration approach to the situation, as they found new ways to encourage community involvement to solve a very local challenge. They encouraged economic activity and strengthened the community by encouraging residents to take care of Tel Aviv businesses.
“The Colu platform is a tool that we were able to use to engage business owners and city residents in a new and exciting way,” said Efrat Makin-Knafo, Director of the Resilience & Social Equality Authority in Tel Aviv-Yafo Municipality, and the Mayor’s advisor on Gender Equality. “As a city, we learned a lot from this program, and we are going to use that understanding moving forward as we develop programs designed to incentivize residents in the Jerusalem Boulevard neighborhood.
The Tel Aviv Municipality is looking at different ways to turn this program into a long-term solution and build elements of it into the annual budget as a way to incentivize its resident’s shopping behavior.