Every time the person made a search, the charity would get to keep a portion of the revenue. Swagbucks grew out of an earlier product that allowed people to earn money for charities. Swagbucks works with a team of about 1,500 mommy bloggers and other Internet influencers like Okawa who help promote the site to their followers in exchange for free swag bucks and, for bigger players, cash deals. The concept partly explains the success of fitness apps that turn exercise into a game with points and competition between friends.Ībout 65 percent of Swagbucks users are mothers ranging in age from 25 to 49 living mostly in the Midwest. This “gamification” creates a positive feedback loop that releases dopamine every time a user unlocks new rewards. Swagbucks’ point system turns everyday Internet use into a game, where nearly every action has a small reward. “We take some of the money from the companies that are looking to engage with those consumers and we give some of those consumers money back.” “I kind of look at us as the Robin Hood of the Internet,” said Eron Zehavi, Swagbucks’ chief rewards officer. While discounts and entertaining content may be enough to get people to visit the site, Swagbucks essentially pays users to engage in activities that makes the company money. Swagbucks makes money when people watch videos, take quizzes and buy products with coupons featured on its site. Its business model may appear convoluted, but it is similar to the rewards program at a local grocery store. Swagbucks has 15 million members and attracts 1.5 million to 2 million users each month. The better the match between coupon and shopper, the more likely Swagbucks is to make a commission off a referred purchase. This wealth of information also helps determine which coupons show up in a user’s feed. Like Facebook, Google and Amazon, Swagbucks has access to user preferences and spending habits, which allows the company to sell hyper-targeted ads to advertisers. Marketers pay to post coupons on the home page, and Swagbucks splits the revenues generated by ads that run at the beginning of video content, which Swagbucks licenses from NBC, Mashable, BBC Worldwide, Hulu and Reuters News, among others.īrands and market research firms also pay Swagbucks to promote survey questions to targeted demographics.
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