Last year, companies worldwide spent nearly $40 billion on media advertising. Experts predict that by 2022, global advertising will exceed $750 billion in total.
Considering the amount that companies invest in advertising, one would assume an online campaign or TV spot is all it takes to earn a handsome ROI. The truth is, it depends. The success of any advertisement relies on content, resonance, medium, audience demographics, and a myriad of other factors.
In the end, advertising is a necessary yet risky method for acquiring new customers. To succeed in today’s market, companies must venture beyond advertising to reach – and keep – customers.
One effective method is the “income opportunity.” Income opportunities are chances for customers to earn their own ROI while participating in activities that increase companies’ ROI. We frequently see income opportunities implemented in gaming apps and platforms.
For example, popular games Candy Crush and Farmville give players the opportunity to earn more in-game by referring their friends. In Farmville, players’ “neighbors” are their Facebook friends, who can give them farming supplies. Candy Crush rewards players who send their friends app invites with extra lives. Game Loot Network, a multi-faceted gaming platform, utilizes a similar model in which players can compete against friends, make new friends, win prizes, and even participate in game development.
Lance Baker, founder and CEO of Game Loot Network, recently talked about the significance of the income opportunity to his company’s business model. Specifically, he spoke about the importance of a “culture of partnership” between companies and customers.
Said Baker of the model’s success: “Our members have trust and patience because they are stakeholders IN our mission, while being ambassadors FOR our mission.”
Income opportunities don’t come without some difficulties. One such difficulty is customers having to rely on friends to accept the referrals. A customer who does not successfully refer many friends may grow frustrated with the platform.
Another difficulty is reliance on third-party platforms. For example, many income opportunity-based models include the ability to refer friends via social media sites. Social media sites are an ideal platform for outreach due to their popularity. In the United States alone, nearly 80% of the population maintains some sort of social media account.
However, social media sites tend to change their APIs often. The changing of APIs can lead to breaks in linking. Just this month, Facebook implemented an API change that disallows Twitter users to cross-post tweets to their Facebook pages.
Nevertheless, income opportunities are a necessity for customer acquisition in today’s market. Minor hiccups in the model should not deter companies from seeking a more even – and profitable – relationship with their customers.