What do you think is a fair price for an
e-mail address? How about 5 bucks off your next
purchase? That's exactly what you'll get for it at
the CogniToy Web site, where the company has
combined instant discounts and viral marketing.
Consumer readily accept the concept of
rebates or coupons. Just send in proof of purchase, or clip out
a piece of paper, and save part of the product's price. The
idea behind viral marketing is just as simple: Make each
customer a source of future customers. It's a cheap
marketing method that's captured the attention of Internet
entrepreneurs since the term was coined three years ago by
venture capitalists Steve Jurvetson and Tim Draper.
"There's an involuntary element to it," says Jurvetson, a
managing director of venture capital firm Draper Fisher
Jurvetson. "You have to embed within the product the
involuntary spread of information."
They first tried the idea with Javasoft's Hotmail service.
DFJ was an investor in the company and was represented on
its board. Their plan was to add a tag line at the bottom of
each e-mail sent from any Hotmail account. It worked -- in
its first year and a half, Javasoft signed up 12 million users
for Hotmail, since purchased by Microsoft. (Microsoft is a partner in MSNBC.)
Other Internet properties have invested in a broader
definition of viral marketing, where the customer is
encouraged -- but not forced -- to spread the word. Enter
a contest at Megadepot Canada, and you can submit your
friends' e-mail addresses to let them know about the
contest. With ICQ, you can send instant messages to your
friends, and if they don't have the software, there's a special
button you can press to send it to them.
CogniToy's marketing strategy for MindRover, a 3-D
computer strategy game, takes the concept a bit further.
With a small marketing budget, the company decided to
offer a discount to customers willing to help spread the
word. Order MindRover from the CogniToy Web site, and
you'll be asked how much you want to spend. Would you
pay $45? How about $40, or $35? It all depends on how
many e-mail addresses you're willing to share.
For each address you provide to CogniToy, you'll get
$5 off your purchase -- up to six e-mail addresses, worth a
$30 savings. You can give more than that if you wish, but
the game will still cost $15. At that price, CogniToy can still
cover its costs. The only catch is that the best deals will
soon expire, so interested gamers with addresses to share
had best act soon.
The game itself takes users to one of the moons of
Jupiter. There they build robots by selecting components
and deciding how it should react to different stimuli. Once
the rover is built, a user can challenge the computer or
friends in a variety of competitions. CogniToy CTO and
game architect Kent Quirk says that one of the game's real
assets is its ability to grow with the user.
"Were trying to
develop an extendable product," says Quirk. We want to
put our toolkits out there as a base set of building blocks."
Players could use those blocks to develop their own
adventures and share them with others in the CogniToy
The spam lesson
CogniToy CEO Kim Quirk says she won't sell the
e-mail addresses to another company, and she's already
learned her lesson about spam.
"We did use some of the names to send out regular
information like, 'Now we're shipping the product.' But we
got some feedback about it, so we don't do that anymore,"
says Quirk. Instead, a separate mailing list was set up for a
She says she's happy with the response to MindRover
so far, but only a week into the plan, the stats just aren't in
to prove its success. The company expects to ship
20,000-30,000 copies this year.