March
13, 2001
Barter
Plays Major Role In ESPN Offer
ESPN.com,
a part of the Walt Disney Co. Internet Group (a tracking
stock), is busily putting together an ambitious renewal
offer to the National Football League in which barter
will be important factor.
To
hold on to that coveted contract ESPN is vigorously pursuing
the renewal of its rights to produce NFL.com, as that
relationship has played a major role in establishing ESPN.com
as one of the web's top sports sites. (ESPN has produced
the NFL's site for the last three years.)
Substantial
Barter Offer A Key Ingredient
ESPN's
offer is valued by the NFL at about $250 million over
five years. It includes $50 million cash upfront and an
estimated $150 million in barter--promotional value--during
the same five year period.
It's
expected that other sports web sites will challenge ESPN
for the NFL rights, and predictably, barter once again
will play an important, if little-known role, in the winning
negotiation.
Strong
Shareholder Message Delivered Trhough Barter Agreement
The
top five executives at Centura Software in Redwood Shores (CA) are
known as the "five-dollar management team." And they've
sent a strong message to the shareholders regarding their unshakable
belief in the company's future. The executives have each agreed to
give up their six-figure salaries, from $150,000 to $250,000, for
a $1 annual salary.
The group is betting
heavily on the 250,000 stock options they each received in place of
their considerable salaries, which will motivate them to expand the
company. Needless to say, they totally believe in what they're doing!
Popular
Web Site Trades On Ability To Provide "Brand Exposure" To
Build Profitable Business
Selling
products, often at very high prices over the web, would seem like
a doomed business model...yet CyberRebate.com is proving to have a
winning business model. Joel Granik, 24, is the founder and CEO of
the popular web site.
While the rebates
often amount to 100% of the purchase price, according to Granik, less
than 10% of the buyers actually take the time to collect their rebates!
He also makes money on those that do because the customers, after
filling out their paperwork, must wait 10 to 14 weeks for the rebate
check. (All the while their initial payment is earning interest for
Granik's company.)
CyberRebate also
is an astute acquirer of merchandise. Granik says that some of the
business inventory comes from close-out sales. But more often, he
contends, suppliers are giving him very favorable terms in exchange
for brand exposure and what Granik says is huge volume!
In February CyberRebate.com
was the 6th most visited web site with 7.7 million unique visitors.
And they've recently concluded a marketing deal with Yahoo.
Here
And There. . .
-
The National
Association of Trade Exchanges (NATE) has scheduled its annual
convention, titled Barter at the Beach, for April 19-21 at the
Wyndham Hotel in Miami Beach. For further information see their
web site at www.nate.org.
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Another new
advertising venue is being tested in Orlando, where closed-circuit
television screens have been placed inside municipal buses to
broadcast a package of news and weather--and plenty of ads!
-
EBay's march
toward ubiquitousness continues with their multi-faceted internet
alliance with Microsoft, which will carry eBay auction listings
including MSN, CarPoint auto-shopping service, bCentral small-business
site, and WebTV. Microsoft's sites collectively now rank No. 1
in global traffic, making them a tremendous vehicle for broadening
eBay's exposure.
-
Wyndham hotels
has 163 properties and is promising personalized services, instead
of using loyalty programs whereby guests accumulate points for
future stays.
Wyndham
guarantees that after a guest fills out a personalized profile,
which includes basic room preferences and favorite drinks and
snacks, any of the company's hotels will (be able to) fulfill
those requests. The company is confident that this totally different
plan is the right competitive approach in today's marketplace.
-
Donald
Hacker, former president of Tribune Entertainment in Chicago
and responsible for overseeing the development, production,
and distribution of TV projects including Geraldo, Siskel &
Ebert, G.I. Joe, and Joan Rivers, has joined Raven Moon International's
west coast office in Los Angeles.
During his
15-year stint with Tribune, Hacker formed one of the largest
barter advertising sales organizations--with annual sales in
excess of $150 million.
Raven Moon
International, located in greater Orlando, is involved in the
production of family entertainment programs and related licensing
and merchandising of videos, toys, CDs, e-commerce, web sites,
music publishing, and talent management.
-
Warren
E. Buffett, the brilliant 70-year old chairman of Berkshire
Hathaway, had some harsh words for the dot.com community, stating
in his annual letter, "Bubble companies' (dot.coms) primary
objective was to make money off, rather than for, investors.
The 'business model' for these companies has been the old-fashioned
chain letter, for which many fee-hungry investment bankers acted
as eager postmen."
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