Thursday, June 16, 2005

Greenzap the Crowned 'Viral' King of Pay-by-eMail

It would be out of order for me to start my new viral marketing blog without paying respect to Greenzap, the latest and greatest viral champion.

Greenzap are claiming their stake of the pay-by-email market currently monopolized by Paypal, but their highly lucrative referral rewardz program (with a 'z' - nice branding touch) is far more attractive than the old, single tier, referral commission structure adopted by Paypal.

They've gone a stage further than adopting a 2-tier structure, like that of the revised Amazon commission model, they've adopted a compensation model based on an MLM structure, similar to companies like excel communications and cognigen, which are gaining favour amoungst more and more Internet marketers and web site owners alike.

They're also paying down to infinity (Community Rewardz), obviously there are breakages built into their compensation model, to qualify for community rewardz, members must first upgrade to gold, which involves loading their account with $100 which must be spent online, gold members receive a pretty cool looking Greenzap branded mastercard debit card.

Also, 20% of the commissions paid must be spent online. I spoke to Greenzap's president Alex Sonkin to find out more about Greenzap, as I was curious how they would sustain profitability with this seemingly suicidal business model.

Not only do they ensure that Greenzap members are forced to spend some of their commissions and all of their $100 online, they (Greenzap) have struck deals with their affiliated partners, and here's how it works...

...When a customer buys through Greenzap, the affiliate commission paid by the selling merchant to Greenzap, is shared between Greenzap and those users reponsible for bringing the purchasing customer (ie Greezap member) .

Well the proof of the pudding at least from a viral marketing perspective was the massive growth they've seen in a very short space of time here's the alexa chart for the last three months:-

Lesson #1 - Ensure You're Servers Are Ready For Massive Demand

A GreenZap spokesperson said, "Due to an enormous amount of traffic, the GreenZap site was temporarily down due to server overload. We worked with Dell® and Cisco® and quickly reinstated the site with a top-of-the-line system capable of handling global traffic."

As you can see from the above graph, the initial spike caused sufficient, downtime, to prevent prelaunch promotion by the core promotional leadership. This also gave competitors time to implement, PR counter-measures, see
et al..

You can see from the traffic trends for the greenzapscam site (who is incidentally affiliated with Alertpay judging from the banner at the top if his site) that he had a lot to gain from the initial interest in Greenzap and the raw numbers of people who were carrying out their due dilligence on Greenzap before promoting it to their lists and members.

Lesson #2 - National Enquirer Traffic Strategy.

When a start-up with a new brand hits the Alexa movers and shakers list, buy a domain and create controversy, especially in the case of a sensitive business such as a payment processor or finance related company. At the time, the Greenzapscam domain was purchased, the KEI (Keyword Effectiveness Index) was skyhigh, ie the demand for this keyword was hugh and the supply was still low, in the case of claiming a scam at such a sensitive time, many people (without doing their own due dilligence will believe whatever they read, perpetuate it, often referencing the original source.

You can see how evidence of perpetuation of negative press on the developers site for the mambo open source content managment system...

Lesson #3 - Piggy Back Large Communities for Ultimate Google Listings.

I created a module to allow mambo site owners to create revenue from their sites by adding a affiliate (ZapID) encoded banners using a plug and play mambo module. Within hours there was a post quoting, the greenzapscam site.

Incidentally if you search google for 'Greenzap' you'll see my project listed Second to Greenzap's corporate site. With the link name:

In Summing Up
I've seen start-ups with good ideas come and go, I sincerely hope that greenzap survive although no one can tell, it's just a matter of waiting and seeing. Having spoke with Alex on the phone, I genuinely warmed to the guy, he's clearly very intelligent and believes in the Greenzap concept, I hope they survive, I recommend signing up and spreading the word.

If you've been put off by the negative press, you may want read the book... The PayPal Wars: Battles with eBay, the Media, the Mafia, and the Rest of Planet Earth by Eric M Jackson here's a link

At least, unlike most start-ups, they didn't waist a chunk of their funding of plush offices, but rather they're operating as a lean efficient company, in the same way as Paypal did in their early days. Did you know that Paypal started out operating above a bicycle shop

Yes, I've signed up and claimed my $25 dollars, but I'm not including my link here, I'd rather keep this site free of affiliate links, to encourage you to send people here for good honest information. :)

1 comment:

Nick said...

You make several excellent points Paul, thanks for sharing about the GreenZap opportunity.

Even though GZ will have it's battles and no business can guarantee success, especially in the early going, I believe they will become a huge company someday.

I say this from following them very closely from the genesis and
have found the executives and people involved in the day to day business to be of good moral fiber and extremely passionate about GZ.

I too have embraced this ingenious concept and think millions of others will also in the coming months and years ahead.

Time will be the ultimate judge but hey, it's free to join and nobody is forced to do anything so why not join at the very least?

Nick Hetcher

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