Search engine offers cash as enticement to switch
Founder describes concept as 'pyramid without the scheme'
Some Internet users are so loyal to their favorite search engine, you'd have to pay them to switch. That's just what Mark Davis has in mind.
Davis is founder and chief executive of Zotspot.com, an Internet service in New York that's offering cash to people who sign up as members and persuade their friends and neighbors to do the same. "I think that's a unique and enticing value proposition to consumers," said Davis, who hopes his cash giveaway can boost Zotspot to the upper echelon of Internet search services.
Rewarding people for using a search engine isn't a new idea. A site called Blingo , founded in 2004, randomly issues prizes to regular users, ranging from movie tickets to Ford Mustang sports cars. In July, the company was purchased by Publishers Clearing House, the magazine subscription agency made famous by its multi million-dollar sweepstakes.
Another pay-to-play search company, iWon, enters users in a daily sweepstakes when they click links on the iWo n site. Every weekday, the site gives away $10,000 to a randomly selected user. The iWon approach seems to pay off for its owner, IAC/Interactive Corp . of New York. According to statistics from Nielsen NetRatings, iWon was the ninth most widely used search engine in the United States in September.
But Davis said he thinks consumers will find the Zotspot approach even more appealing. Blingo and iWon users may win something, but they may not. "With Zotspot, it's predictable, it's recurring, and it's controllable," said Davis.
A visitor signs up for the service and logs in whenever he uses the site. Each of his searches is tracked in order to estimate how much money he should receive. But to be eligible for the payoffs, a user must also persuade at least one other person to start using Zotspot. He can do this by automatically sending e-mail messages to friends and family, or by putting an Internet link in his e-mail messages or on his website. Users get credits when their friends join Zotspot and begin using it. If these people sign up new users, the first user gets credit for them as well.
Zotspot estimates that each referral that uses the service as their primary search tool will generate between 10 and 50 cents a year for the person who referred him. Someone who chalks up 10 referrals at, say, 25 cents per person per year, would get $2.50 for his trouble. But if those 10 each recruit another 10, that makes 110 users, or $27.50, and if the 100 new users each sign up 10 more, that makes 1,110, or $277.50.
Davis admitted that his plan sounds like a pyramid scheme, a famous method for defrauding investors. But he notes that Zotspot users don't invest any money. Like other search services, the site is free. It will generate its income and its payouts by selling advertising space. As a result, said Davis, Zotspot users have nothing to lose. "It's a pyramid without the scheme," he said.
Susan Feldman , search engine analyst at IDC Corp. in Framingham, said the offer of cash for Internet searches has a certain appeal. "If you've got a great personal network, you could end up making a fair amount of money, possibly," she said. However, Feldman said that for many searchers, the quality of search results is the most important consideration. Both Blingo and iWon get their search results from well-regarded services -- Google and Ask.com respectively. But Davis declined to reveal which company delivers Zotspot's search results.
Still, Feldman said that some consumers may choose Zotspot's offer of extra cash, even if the search results aren't as comprehensive. "If every time you do a search, you're hearing a ka-ching, maybe that's almost not as important," she said.
Hiawatha Bray can be reached at bray@globe.com. 