Not all Web start-ups died with the dot-com bust. In fact, some actually took their original ideas, tweaked them a little and grew into booming small businesses.
Take Gratis Internet (http://www.gratisinternet.com) for example, which started out as two guys in a one-bedroom apartment in Washington, DC. The business has blossomed into a $20 million enterprise that brings customer leads to major corporations through giveaways of high-end products on several different Web sites.
Advertisers pay Gratis a fee of about $60 for each lead they get through the sites. At present, Gratis generates about 50,000 new leads per month for its corporate clients, says co-founder Peter Martin.
The sites include freeipods.com, freephotoipods.com, freegamingsystems.com, freehandbags.com, freeflatscreens.com, freedesktoppc.com, freevideogames.com, freedvds.com and freecds.com .
On freeipods.com for instance, users log on and enter their information, including name, address, phone number and date of birth. Once they complete that (and offer referrals for five friends), they’re sent to a page with offers for things such as cell phone ringtones, digital videodisc rentals, credit cards or weight-loss products. After they’ve opted in to one of those offers, they can receive their free iPod.
Gratis has found leads this way for many different companies such as Blockbuster, BMG Music, Citibank, Stamps.com and Wal-Mart. “But we only have 40 or 50 advertisers we work with at any given time,” says Martin, noting the method is effective for capturing prospects ages 18 to 24 with college educations.
“You can’t reach them through traditional channels like newspapers and television anymore so advertisers are looking for new ways that can reach them,” says co-founder Rob Jewell, who wouldn’t reveal how many end-users Gratis has.
Gratis’ current plan differs from its original model, which required consumers to build up points to get free gifts, says Martin. “People soon began demanding more so it evolved” to its current model.
Now, instead of giving away things like coffee mugs and t-shirts, Gratis decided to give away products people might really want like iPods, Prada bags, flat screen televisions and personal computers. So far, $14 million worth of freebies have been awarded.
Gratis works with several different advertising agencies to recruit new corporate partners and does very little selling on its own behalf, says Martin, adding that Gratis will continue operating in this manner for the foreseeable future.
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