subject: Xbox Red Ring Of Death - Freebie Sites Taking The Net By Storm [print this page] The first freebie site saw the light approximately 4 years ago. Since then, millions of users have signed up for them and company owners have multiplied their offerings a thousand fold. The business continues to show tremendous growth as browsers can't get enough of these websites and the people that run them are capitalizing big time.
The basis of this business design is a easy one: "incentivized", or "forced leads". Let's try and make those industry terms clear for the layman. It all begins with online advertisers of the CPA variety. Advertisers in all shapes and sizes offer a CPA or Cost Per Acquisition payout to affiliates that promote their offers. When a user signs up for one of these offers, the affiliate makes a commission.
Here is where the "incentivized" part comes in. The affiliate, in this case, a freebie site owner, shares this commission with the person that generated it. This sharing takes many forms including gifts ranging form the original free iPod to free Xbox 360s and just about anything in between. Making over $10,000 in easy money just by completing various affiliate offers on freebie sites, cashback rewards have become increasingly popular.
Aside from the opportunity to make free money or earn a gift, these sites have something else working to their advantage that make them spread like wild fire: viral marketing. Word of mouth for these literally spreads like a virus, from one person to their social network and so on. The reason for this is that freebie websites provide rewards to customers who refer new customers.
On one side of the company model, users are required to complete one offer themselves and refer a set number of buddies to do the same so they can gain their free gifts. On the other side, customers earn a fixed cash bonus for every person they refer to the site.
That's all well and good from the user's perspective, but what makes this design so attractive to the business owners that run these sites? The easy answer is of course cash. Here is how these earnings break down.
In this first example, the site owner is offering a Video Ipod for 8 referrals. This means the user has to sign up to the site, complete one offer and refer 8 of their friends or family to do the same. Once this procedure is complete, they receive their gift. Here is the catch: 90% of customers can fill an offer and refer one, two, three friends. Then it gets difficult and unless the person in question has a huge social network or information of how to get more referrals through forums or advertising, it pretty much stops there. In this situation, the site owner has generated an average of $25 to 30 per completed offer and has not shipped a gift. That's $25 to $120 in profit without doing a thing.
The revenue share principle will then be used for this second example. 60% of the commission money will be obtained when the offer is completed. With thousands of dollars offers up for grabs, the website owner is pocketing 40% of hundreds of dollars per person.
Both models have a third stream of revenue which is more or less exploited according to the information and savvy of the particular website owner. Freebie Websites can generate thousands of signups per week. That means thousands of optin email addresses that can then be marketed to. Smart site owners will choose the right offers to present to this ever growing list and be on their way to opening up another very viable source of income.
However, there are also some drawbacks. Spammers have taken advantage of this principle and instead of using lists wisely, have thrown each offer in the book at their users until they turned away in disgust. Some of the largest operations have even sold customer lists with millions of names to known spammers in exchange for a quick buck.
As the business forges ahead, the sites that promote integrity and originality in their offerings will reap long term rewards while seeing steady growth for years to come.
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