For my 15th birthday I remember getting an iPod for the first time. It was June, and it was just in time for summer travels. Sadly, about four days later Apple released a new version of the iPod that, at the time, was 4,000 times better than that old piece of junk I was carrying around. Too bad I couldn’t have learned that Apple was on the verge of releasing a new gadget!
Thankfully, that problem is now null and void, with the help of Seattle-based startup Decide. The company, backed by Maveron, Madrona Venture Group, and a number of angel investors, helps consumers learn the patterns of gadget release cycles, and helps predict with a high degree of accuracy when the best time to purchase a device is. To date, Decide has raised $8.5 million.
The technology behind the service is pretty advanced, using a mixture of hard numbers and semantic data processing. The algorithm looks at historical trends as well as rumors and announcements on blogs, using technology developed in part by the University of Washington. This means that recommendations are up to date on the latest reports and rumors.
Using this algorithm, the company can help you with nearly any electronic gadget purchase. For example, if you’re looking to buy a new Nikon DSLR, you want to know if the price is going to go up or down soon. Using this example camera, the Nikon D51000, you can see that you should buy the camera now before prices go up, as they are expected to rise by around $63 in the next two weeks.
This is very specific data, and it’s exactly the sort of data needed when shopping. In almost any situation, buying a laptop, a camera, or even a refrigerator, the price cycles are fairly consistent and predictable. Even MacRumors runs a site that tells you when to purchase or not purchase Apple gadgets. Decide functions under mostly the same concept, but covering more than Apple gadgets and providing much more data.
The Decide team is so adamant that the algorithm is accurate and that users should trust it, they recently instituted a “Got Your Back” guarantee. If you purchase a device based off of Decide’s recommendation, and the price drops at any retailer within 14 days, Decide will send you a check for the difference automatically.
Decide has shared some data with us on how well the program is doing, and it seems to be working rather well. The Got Your Back deals have been 87 percent correct, with the remaining 13 percent that have gone lower in price only dropping by an average of 1 percent. Consumers also seem to be loving the guarantee, with signups up 480 percent, and traffic up 50 percent.
One example that the company shared is a Got Your Back deal for a Vizio 42 inch television set, which was featured on June 9 as a guaranteed deal for $500. Now, only four days later, the set is selling for $584.
Until now, the deals have been sourced algorithmically, with only 10 chosen deals featured daily. However, the company feels that this isn’t enough, so it is expanding the service.
Over the course of the next few months, Decide will be expanding its service to reach even more gadgets. This means that instead of only ten deals per day, there will be tens of thousands of deals for people to peruse. With such a wide range, the company is hoping to attract many more customers and users.
With such a wide swath, however, come risks. As the company expands into new product categories, some of which are many times more expensive than a simple laptop, it will really be putting its money where its mouth is. Say you purchase a $25,000 car off of Decide (not possible at the moment, but a theoretical future category for the company). If the price drops by $2,000 two days later, that’s money that Decide has to send to you because of the guarantee.
As popularity grows with the company, these situations could prove costly. Imagine if Amazon was to rollout a feature like this today. It would be sending out checks for millions of dollars every day. Regardless of how accurate an algorithm is, there will always be flaws, and those flaws will be amplified as more people are buying based off of a recommendation.
Because of this potential problem, Decide is continually tweaking its algorithm and trying to improve it. The company so firmly believes in its algorithm now, that the Got Your Back guarantee offer is applied to items that have a price probability of staying steady of 90 percent or more.
As a special offer for PandoDaily reader, Decide is being even more generous than normal. If you send an email to firstname.lastname@example.org, with the subject line “PandoDaily”, they will send you a special private invite. This invite allows you to purchase anything with an 85 percent or higher rating and be guaranteed a refund if the price drops.
Providing this refund guarantee seems like a risky business model that could bankrupt the company. More importantly, though, putting its money where its mouth is gives users a level of confidence in its product that no other company can provide.