Looks to Infest the Net

Share this content: will launch a hybrid loyalty, sweepstakes and entertainment model next month designed to attract consumers and lead them to client sites. While the company thinks it has a winning mix, at least one industry expert is skeptical.

The program, dubbed the Promotional Entertainment Platform, works like other points programs. Consumers collect funBugs by playing games at the site, shopping at client sites, referring friends, completing surveys, joining opt-in e-mail lists or a number of other ways.

Each funBug acts as a sweepstakes entry for weekly "Web-spendable" cash drawings. The more funBugs collected, the better the chances of winning. The cash rewards are stored in a user's account and can be spent at any site that accepts MasterCard.

"For consumers, its really an entertainment site where they can have fun, play games and win Web-spendable cash awards on a frequent basis," said Nick Woodman, CEO of, San Francisco.

Jim Nail, senior analyst at Forrester Research, Cambridge, MA, does not think consumers will bite.

"So you collect a bunch of funBugs and have a chance to win nothing?" he said. "There are so many point programs out there that have a guarantee for gratification. Why would a consumer want to collect these things that have a chance to end up being nothing? Unless they're bogus and everyone wins, it doesn't make sense why anyone would want to do that."

There will be many winners, Woodman said. The weekly cash drawing will distribute thousands of Web-spendable cash awards.

Even though many consumers will win, having them work to receive funBugs and then hope they are converted into cash to shop is somewhat convoluted, Nail said.

"If it's this complicated, they're going to have a problem," he said. "For loyalty programs to succeed, they have to be easy, like frequent-flier programs. I fly, I earn miles -- that's easy. Creating two or three more steps to get to the prizes is too much damn trouble for consumers." has a number of tricks up its sleeve, though. Feeding off the popularity of gaming sites, the site will offer up to 50 games to draw consumers. They will include classic video games, chess, parlor and trivia games. These multiplayer games will appeal to the gambling sort, as you "can bet someone 20 funBugs on a game of chess," Woodman said.

Additionally, it is creating "funHunts" for client sites. This activity asks consumers to search for funBugs that are placed intermittently throughout the client's site. "The difference is the entertainment value of what we're providing," Woodman said.

From a business standpoint, he said, "at the core of funBug is a promotional service designed to maximize return on investment for any business [online] or offline looking to promote itself on the Internet."

Companies that get involved with the site also can serve as vendors where consumers can spend all the money they win.

"As the community of winners grows, the more and more attractive they will become to businesses," Woodman said. "They will be a community of people that have cash and are ready to spend online. It's our business to drive them to clients' sites. We can give them more funBugs for each dollar spent at client businesses. It becomes circular."

There is zero integration required for accepting funBug winnings.

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