Loyalty and incentive marketing is an enormous business. Hundreds of millions of people use sites like Plenti, ShopAtHome, eBates, RetailMeNot (NASDAQ:SALE) and Coupons.com (NYSE:COUP) to save money with coupons and earn cash back rebates. ShopAtHome alone boasts of 94,000,000 users.
We’re going head to head with them. And we could end up just as large, because we’ve got the crowd. The crowd’s our customer, our champion, and most importantly, our owner. When we succeed, the crowd’s responsible for that success, and shares in that success. By the time we’re done, we expect the crowd to own over 50% of iConsumer.
eBates sold to Rakuten for a reputed $960,000,000, with 2,500,000 members. The stock market valuations of RetailMeNot and Coupons.com, just to name a couple, are each in excess of $1Billion.
The iConsumer customer earns shares in addition to earning cash back and saving money. They also earn shares by recruiting their friends to earn cash back. Because they’re owners, our customers are incented to shop and be brand champions.
We’re up and running. Test us out, see if you like the product.
The Site (www.iConsumer.com)
Site launched June 19, 2015
Proven to be 100s of millions of potential members big by existing customers of incentive and loyalty sites. The revenues of these sites combined is also in the hundreds of millions.
Additionally, the millenial market is even larger. iConsumer is offering features and experiences designed to attract this large cohort.
iConsumer licenses its underlying technologies and infrastructure from iGive.com. It also receives operational and sales support from that company. iGive, owned by iConsumer’s founder – Robert Grosshandler, over the past 17 years has built technologies (including apps, web site, and browser extension / add ons), infrastructure, and established over 1,600+ retailer relationships. iGive turns shopping into philanthropy for over 30,000 charities. It has over 350,000 members, and sends checks to tens of thousands of charities yearly. This headstart makes the iConsumer site and service approach feature parity with its competition.
The Revenue Model
Retailers and advertisers pay iConsumer a fee or commission when iConsumer directs traffic (customers or potential customers) to their stores and sites. Having a wide variety of stores and advertisers (generally brands) helps to attract and retain the people who become iConsumer members.
Crowd Built. Crowd Owned.
Ownership isn’t going to be sufficient if the site or service cannot compete with the leaders. While the features and functions of iConsumer approached parity with the competition at its launch, it is our intent to explicitly enlist the crowd to quickly extend and improve our offerings.
The Competition – Lots and Good
The broad category iConsumer competes in is generally called incentive and loyalty marketing. iConsumer and its competitors seek to provide value to brands and retailers by delivering audience and customers cost effectively.
In addition to the companies named elsewhere, there are hundreds of competitors. American Express just launched Plenti. There are smaller sites, like Brads Deals. Large sites like Coupon Cabin, MyPoints, and uPromise.
According to Compete.com and other sources, there are hundreds of millions of people using these sites, in the U.S. and elsewhere. There are sites that exist solely to compare the offerings of these sites.
As of June 19, 2015, Coupons.com (NYSE:COUP) has a market cap in excess of $1B. It went public with an initial price of $16 per share. RetailMeNot (NASDAQ:SALE) has a market cap in excess of $1B. It went public with an initial price of $21 per share.
The Economics – Size Matters
Competitive intelligence, plus publicly available information, suggests that each member of sites like eBates or ShopAtHome generates ~$50 in revenue annually. This is confirmed by the experience at iGive. Generally, over time and subject to competitive pressures, the member receives approximately 80% of that revenue as cash back.
The cost of servicing that individual member is near zero. That is, the cost of operating the business does not go up appreciably with each new member. Once the company has sufficient members to cover the cost of operating the business, each additional member contributes substantially to the profit of the company. Therefore, attracting lots of members is a key to success.
Historically, attracting new members has required significant investments in acquisition costs (cash). By attracting new members with the opportunity to participate in the fortunes of the business, the cash requirements for growth are reduced.
The Offering – Invest Only When We’ve Proven Ourselves
We aren’t interested in selling unproven futures. Rather, we seek investors who can help us grow the value of the business by being champions, and by being customers. We need customers much more than we need investors. We need investors and customers who will spread the word about this unique opportunity. Once we’ve achieved the future, then we want you to be an investor. We also want you to reap the rewards of indicating your interest early.
We’ve done three unique things with this offering.
- First, the minimum investment is $50. More investors is better.
- Second, we have tiered the pricing, tying it to iConsumer having achieved membership milestones. You pay less for your stock by indicating your interest early.
- Third, we will not close on a tier unless we have hit that tier’s milestone.
Here’s an example: You decide you’re interested. Indicate your interest by reserving shares. You may choose to reserve shares at $.09 a share, and at $.42 a share. Only if the SEC qualifies our offering AND we exceed 50,000 members AND you still want to invest, will you be asked to write a check to iConsumer. Only if the SEC qualifies our offering AND we exceed 500,000 members AND you still want to invest, will you be asked to write another check to iConsumer.
The full details and milestones can be found on the “terms” tab.
We think it’s possible to build a business with many millions of members, very quickly. We have proven technology and infrastructure to allow us to scale. We’re operating in a market with a proven appetite for our fundamental offering of savings and cash back. A proven market with hundreds of millions of prospects.
If we’re able to build a business with a million members, we expect (but no guarantees) it’ll have revenues exceeding $50,000,000 annually, and be profitable on a pre-tax basis and be cash flow positive. At two million members, profitability should more than double.
Along the way, we can involve our customers to help build and guide the business.
Visions don’t always come out the way we expect. Indeed, they never come exactly as planned. So there no guarantees, no certainty to achieving the vision.
By investing as little as $50, you can help make the vision possible.