Contest Site Feeds Prospecting E-mail Databases
Winfreestuff.com Inc., an Omaha, NE-based Web company, relies on a sweepstakes model to collect e-mail addresses for online merchants.
Consumers visit www.winfreestuff.com to enter contests sponsored by e-commerce concerns that sell apparel, health and beauty products, food, toys and other goods. Visitors type in their e-mail address to enter whichever contest they’re interested in.
For example, Art.com touts a chance for a $150 gift certificate. On the entry form is a place to opt in to receive offers from Winfreestuff or the merchant. Consumers don’t have to provide e-mail addresses to be eligible to win a contest.
“About 70% of consumers agree to receive information from both Winfreestuff and a merchant,” says CEO Stephanie Healy, who left her position as interactive sales manager at Omaha Steaks to launch the dot-com with her husband Mark. “After they opt in, they immediately get a thank-you e-mail and a chance to opt out. Our opt-out rate,” she adds, “is less than 1%.”
The company processes over 1 million sweepstakes entries a month. Since starting the company last July, the Healys have built a database of about 500,000 e-mail addresses. The average visitor signs up for three contests. “The people who come to our site are not just professional sweepstakes entrants,” says Healy.
In January, venture capital firm Draper Atlantic, in Reston, VA, gave Winfreestuff $1.5 million in exchange for 15% ownership in the firm.
Some 45 merchants sponsor contests, including Spiegel.com, Art.com, HickoryFarms.com and TheGolfer.com. They pay for each opt-in e-mail address they receive.
Shop2U.com, which sends personalized mini-catalogs to catalog customers by e-mail, has acquired thousands of prospect addresses through the site. It’s testing how prospects respond to offers from catalog clients includingMacy’s by Mail and The Company Store, says Roger Hiyama, Shop2U’s vice president of catalog e-commerce.
Winfreestuff attracts visitors with banner advertisements displayed on 12,000 Web sites.
Another revenue channel is through ad buttons placed on the home pages of 50 network partners. The button on Megachannels, for example, invites visitors to “click here” to enter a Winfreestuff contest for a $5,000 cash prize. Clicking prompts a pop-up screen identical to the form on Winfreestuff’s pages.
Winfreestuff pays Megachannels for every entrant who opts in to receive offers from Winfreestuff.
