SBJ/October 29 - November 4, 2001/Marketingsponsorship
Direct Referrals enlists fans of AFL, Grizzlies as marketers
Published October 29, 2001
New York-based Direct Referrals Marketing has signed the Memphis Grizzlies and the Arena Football League to use its online viral-marketing program.
The Grizzlies will employ the program this season to promote sales of all ticket packages. The Arena Football League will test the program with the merchandise store at arenafootball.com with an eye to expanding into ticket sales at the team level later in the season.
Direct Referrals Marketing will send branded e-mails to lists provided by both clients encouraging fans to become customers. The fans are further encouraged to forward the e-mail to their friends, with the incentive of being awarded merchandise gifts if their friends make purchases.
Software will track who forwards e-mails to whom, which recipients open a marketing brochure that is part of the e-mail, and which recipients go on to make purchases. Users' e-mails will be kept confidential from the clients unless they opt in for newsletters or other offers.
The programs will start with e-mails to between 1,000 and 2,000 fans.
"Our type of marketing is 'quality over quantity,' as it starts with existing fans in the likelihood that they will be more interested and their friends will be, too," said Greg Fomin, company president.
Fomin wouldn't specify terms of the two deals, the new company's first. He said the company "rate card" calls for an up-front fee of between $2,500 and $5,000 and between 2 percent and 8 percent of revenue on eventual sales.
Viral marketing has been an Internet buzzword for several years, given the medium's strength in quick communications, but this is the Arena Football League's first experiment.
"We've spoken to some companies like this in the past, but the reason we're doing it now is partly based on timing and partly on their presentation," said Marc Lowitz, AFL's vice president of broadcasting and new media.
Direct Referrals Marketing was formerly ReferralNetworks.com, which did corporate employment recruiting via the same technology. Clients included Enron and American Express Travel, but the company did not reach profitability before the economy softened, Fomin said, so it changed its name and applied its software to ticket sales.