Laying the foundation of a successful business model
STRATEGY Being in the company of great brands can help emerging brands immensely
Even while the idea of contests2win.com was very innovative, I believe that its crown jewel was its business model.
When I began pitching to clients for business, I asked myself—what I would pay contests2win.com to host my contests? As a hard-nosed businessman, my intuitive answer was ‘nothing’, because the concept was untried, untested and unproven. I then wondered that when I, the innovator of the idea was unwilling to pay for my own business proposition, why would others pay for it at all?
This troublesome question made me think up a unique business model for contests2win.com which worked like magic. To all the initial clients I met, I offered my entire range of services— online contest creation, hosting, response management and analytics and winner selection, free of cost. There just was a simple favour that I asked in return. Brands that signed me up needed to promote my contests2win.com link on all their advertising creatives on print, radio, television, hoardings and other media. I pitched this as a simple barter that would not just save the brands money, but also serve as a novel idea to excite and motivate their consumers to participate in their contests in a new, engaging way. The idea seemed like a no-brainer! Every brand that I signed up readily agreed to this barter. MTV was so excited by this new interactive medium that they got their Video Jockeys to promote my website on the air! My business model was free, but not free.
As I gained momentum with my idea and unique business model, I stumbled across many surprises. The Hollywood Studios in India such as Paramount Pictures, 20th Century Fox, Warner Brothers had insufficient advertising budgets for the many Hollywood movie titles they released through the year. I happily swapped contests with them to provide excellent visibility for their movies, in exchange for plenty of free movie tickets. Jacinto Fernandes of Paramount Pictures became an engaged client, and we would even offer him consumer movie feedback and sentiment analysis of the excitement a movie was generating.
As we worked closely and more deeply with movie studios, contests2win. com would poll users on different versions of movie poster creatives for an unreleased movie.
The poster most liked by our consumers would be the one printed by the movie company to release in India. A broader value proposition for contests2win was quickly developing.
In the early months of my website launch, I mainly chose to partner brands that were hip, super-urban and premium so as to match the user profile of the first set of internet consumers in India. A sweet lesson I learned was that hosting contests of these top-class brands had a very positive rub-off effect on my brand. By being in the company of great brands, I was being perceived as a great brand myself!
Quickly, consumers began to flock to contests2win. com to win free movie tickets, music CDS, cool t-shirts, interesting memorabilia (a piece of the Berlin Wall, for instance) and super-aspirational prizes (a Mercedes for a day; a cinema theatre reserved for a couple) with just a few clicks of the mouse. By refreshing my contests several times a day, I began to lure consumers to the site daily, and later, even hourly! My website had become a habit for internet consumers in India. Contest2win.com cooked up the perfect storm. Just a year after starting up, over a hundred of the top brands in India had partnered with us for our innovative, engaging and immersive internet idea. As barter, these brands advertised contests2win on media spend that was worth more than twenty crores (an enormous sum back then).
Top brands would sponsor heaps of small, medium and large prizes and we gave away more than one crore rupees worth of prizes to consumers, by the end of our first year. The website began to generate massive buzz, got lots of press and media coverage and became an Indian internet sensation!
MY LEARNINGS
The biggest lesson I learned was to be prudent, practical and street-smart while pitching a business proposition. Many entrepreneurs I knew could not accept giving away their products and service for free. I fought that mindset and did the opposite. The advantage of starting out as a free service meant that I did not have any critical deliverables to be held accountable for. Who would demand anything from something that came complimentary? For many months, contests2win was a free service that partnered with the world’s greatest brands, without having to live up to their stringent expectations or asked to deliver an ROI (Return on Investment) because really, there was no ‘I’— Investment! This amazing relationship allowed me to perfect my business, create a deep value proposition for clients and build a great brand for myself. I mastered the art of ‘piggyback value creation’. Another deep lesson was understanding the psychological drivers of a business (which exist in every business) and leveraging them to the fullest. In my case, it was the lure of ‘free’. Free prizes made consumers go crazy, and they visited my site very frequently looking for free prizes. Soon online contest on contests2win.com had become a habit. And a habit, as I would figure out, was the foundation of a super-successful business model.
THE BIGGEST LESSON I LEARNED WAS TO BE PRUDENT, PRACTICAL AND STREET-SMART