Wednesday, May 2, 2007

What happened the last time around? AllAdvantage revisited

What happened the last time around? AllAdvantage revisited

AGLOCO and pay-to-surf is not a brand new idea. In fact, though different in a few key ways, AGLOCO is the new version of AllAdvantage, a company that, in its less than two years of existence, paid out over $120 million to its members and proved that pay-to-surf could indeed work.

Those of us who remember AllAdvantage remember the fever of that time: people were starting small web-based companies and making millions, sometimes in just weeks. The economy was booming. Stocks were red-hot, and the Internet was changing everything.

AllAdvantage was no less revolutionary - you, the user, were going to get your share just for using the Internet. It was a smashing success.AllAdvantage was launched on March 31, 1999 - the first "infomediary" in which companies and web surfers would mutually benefit. It immediately became tremendously famous. As you can see, people even covered their cars with advertisements for the company so that all could see. Within little time, AllAdvantage vaulted into the top 20 most visited Internet sites. 10 million members signed up.

The program used the Viewbar, a software application members downloaded from the main site that observed the pages surfed by the user and showed ads related to the content being viewed in the user's browser. It was the best way for big companies to reach people with direct, relevant offers.

The resounding success of AllAdvantage was also due to the referral system put into place to encourage the spread of the program. Every user got their own personal code (like the one on the back of the car in the picture above) that they would use to get referral credits. Each new member referred resulted in a raise in income, and furthermore, the people referred by those referrals would also boost the original member's income. This was the case up to 5 levels below the original user.

This yielded a nice sum of money for those who took advantage of it. In less that two years, had paid out over $120 million in checks to the loyal users of the program. So why then did AllAdvantage suddenly cease to exist?

The answer has to do with the situation of the tech market in 2000. In those days, everybody had illusions of grandeur about the Internet and e-commerce. A company without any profit to speak of would attract gigantic investments just by existing. Eventually, however, this loony arrangement began to melt once investors started realizing there was nothing upholding the boom. Suddenly, no one dared to invest. At the time, AllAdvantage was about to go public (the IPO was to take place during early 2000) but it was too late. After a market freefall, AllAdvantage was forced to close its doors.

With the advent of AGLOCO, history repeats itself. But then how can we be sure that it will survive this time?

In the year 2000, the Internet was young. Its potential was great, but it was far from mature. There was no precedent with respect to programs like AllAdvantage; everything was done while flying at 10,000 miles per hour. Nobody knew yet what the best way would be to launch an advertising campaign, since there was very little information back then about Internet users' habits. Nothing was stable or set in stone. Everything was either a huge success or a colossal collapse.

Today is different. There are Internet companies like Google, Wikipedia, (film database) Adobe, etc., that are here to stay. It's no longer possible to just start up a company and have it become one of the biggest in the world in 2 weeks. Also, keep in mind that throughout the years the Internet has expanded rapidly, such that now the market for a company like AllAdvantage is much greater than before. Finally, the Internet community as a whole is more mature, efficient, and more intelligent than it was then. It is thus more ready for the return of this kind of business. Get your part of it now!

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