BlueTie has come up with a novel way to generate revenue for its collaboration suite aimed at small businesses. Rather than licensing, subscription or ads BlueTie is using"featuretisements," where the company is paid on a cost per action basis. The idea is to integrate monetizable services into the workflow of email and calendaring. For example, when a user adds a trip to the calendar, they can book travel from with in the Web application via integration with Orbitz.
"The ad model is flawed for the world of applications," BlueTie CEO David Koretz told me. "Applications are about workflow; ads are about disruption. Annoying the user won't lead to the highest monetization--that's why social networking ads are not successful. Advertisers don't want to be in an email application, but if you do it right it shouldn't feel like ads."
Working with Orbitz, Business.com and Constant Contacts, BlueTie was able to generate about 70 cents per user in 2007, Koretz said. Currently, BlueTie has about 4 million users across 230,000 companies. Koretz estimated that 2 percent of customers are using the Orbitz service.
BlueTie, which has 85 employees, is profitable and has more than $10 million in annual revenue, Koretz said. The software is free for up to 20 users, with a paid version at $4.99 per user per month that includes additional storage, live customer support, POP3/IMAP4 support, WAP 2.0 mobile support and Outlook replication and instant messaging.
Koretz said that BlueTie has signed up 19 partners for featuretisements in addition those already live on the service (Orbitz, Business.com, Constant Contact and MapQuest). Among the new partners are eFax, Skype, Amazon and FTD. Clicking on a birthdate, for example, can initiate a pop up screen from Amazon or FTD with a selection of appropriate gifts. Koretz expects featuretisements to raise revenue per customer this year to $2 per user.
Next version of BlueTie will take airline ticket data and attach it as an e-ticket and add it to calendar, Koretz said. In addition, BlueTie is working with Orbitz to alert users of flight time changes.
Some of this mashup functionality is available in other services, such as Yahoo's Zimbra collaboration suite, but BlueTie is taking workflow integration further.
However, the limited choices per category is a problem, such as if you are an Expedia or Travelocity rather than Orbitz user. Koretz said he is working on allowing a choice of service providers across categories for customers. In addition, BlueTie 's featuretisement APIs will be offered as part of a syndication platform available for use by other Web applications later this year, Koretz said.