Jul 6, 2014

IDEA #125: Get Free Products by trying services/products

This idea is based on TrialPay. Basically with TrialPay, after you buy a movie ticket at Fandango or a concert ticket on Ticketmaster, they tell you “Get $20 cashback, try one of these great offers!”. That’s the gist of what TrialPay is. If a user signs up for Netflix through them, it might be a 30- or 60-day free trial of Netflix, which Netflix pays TrialPay like $14 (let’s assume) for each signup. TrialPay then might pay $10 to a Publisher (like Fandango or Ticketmaster) that can bring in those signups.

On the other side of the equation, Netflix runs their numbers and knows that the lifetime value of a subscriber is $90 (I’m making all of these numbers up), and maybe that 1 in 5 free trial signups result in an actual subscriber. Thus $14 x 5 = $70. Thus, they earn a $20 profit over the lifetime. It’s money out, profit in for Netflix, so they want as many signups as possible.

Anyhow, I think there’s an opportunity for another middleman. You could have a selection of 1,000 of the top products, like a new XBOX game that retails for $60. For those people that want that game, but maybe can’t afford it at the moment, … if they were to work for you to get 10 people to try Netflix for free (no strings attached), then TrialPay would pay you $10 each, which is $100. With that $100, you could pay Amazon.com $60, send the XBOX game direct to the person that got you 10 signups, and pocket $40 in profit.

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