February 24, 2014, 12:55 PM

Overstock.com offers discounts to students through an online ID service

Students can now get free membership in the Club O free shipping program. Overstock introduced a similar offer last year for military personnel, using the authentication services of ID.me.

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Overstock.com Inc. announced today it is offering free membership in its Club O free shipping and loyalty program to college students. It began offering the same deal last year to members of the U.S. armed forces.

Club O, which normally costs $19.95 a year, offers members free shipping plus 5% in credits on purchases on Overstock.com, a discount retailer of general merchandise.

"I have always believed education is extremely important and I have the utmost respect for those that serve our country," says Overstock.com CEO Patrick Byrne. "As a company, we are showing our support by offering free memberships to Club O, which is the most generous loyalty program in online shopping."

Overstock uses identification vendor ID.me to authenticate that an individual is a full-time college student or a member of the military. ID.me relies on connections to public and private databases to determine an individual’s eligibility. Once an individual has an ID.me he need only enter a user name and password. ID.me says more than 300,000 individuals have registered with its service.

More than 60 e-commerce sites offer online discounts, using ID.me to verify eligibility, says Blake Hall, CEO of ID.me. Hall, a former U.S. Army captain, says he and Matthew Thompson, another Army Ranger who was a classmate of Hall’s at Harvard’s business school after their military service, started the company after seeing that many retailers and brands offered military personnel and veterans discounts in bricks-and-mortar stores that were difficult to offer online.

Among those offering the ID.me service is athletic gear brand Under Armour, which began using the service in November 2012 to offer military personnel 10% discounts that increase to 15% around holidays like Memorial Day and Independence Day. The program generated a 30% increase in sales from its marketing program geared to military personnel and 70% of the customers who use ID.me are new to Under Armour, the company says. Under Armour extended the discount program last year to first responders—police officers, firefighters and emergency medical personnel.

Overstock.com did not disclose how much it is paying for the ID.me service. Hall says, "We typically charge on a per verification basis though we will also license on a subscription basis in certain cases. The cost is less than $1 per verification or a percentage of the cart, depending on merchant preference." Volume influences pricing, he adds.

Overstock.com is No. 31 in the in the 2013 Internet Retailer Top 500, and Under Armour is No. 143.

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