Frode Jorgensen CCO of BidiFy has been watching what my reports, and is continuing to keep me posted on the changes he and his team feel is important in staying compliance not just in the USA, but also around the world. This new report on BidiFy and the Bidsson Penny Auction truly shows some positive improvements. I will be sending Frode some questions which people are still wondering about this week, so be watching for an update soon.
BidiFy Frequent Sale Credit replaces old BidiFy Mandatory Sales Account
On top of the already powerful rewards system Bidify has put in place, Bidify rewards you Frequent Sales Credit everytime a sale takes place in your organization. In fact every time a sale takes place in your pay-line we reward you with a 20% Frequent Sale Credit. Frequent Sale Credits cannot be withdrawn as cash, but can instead be used to purchase products both in Bidify & Bidsson. It is similar to a “Frequent Flyer” program.
You can spend your Frequent Sale Credits in multiple ways with a single click of a button.
– Purchasing Retail Bids to bid at auctions.
– Paying for your won auctions. – Buying products at retail price directly from the Bidsson site.
– Paying for your monthly administrative fee in Bidify.
NOTE: Frequent Sale Credits used to purchase Retail Products will generate PV and GV, and can also generate retail bonus to your sponsor. Frequent Sale Credits cannot be exchanged to cash.
First premium Bidsson Auction bring both revenues to the penny auction house, and big wins for the bidder.
Randy Jeffers is not new to Network Mareketing. As one of the most colorful founders in current MLM history, he has experienced both ups and downs. Randy rose to fame by launching one of the fastest growing network marketing companies in history Destiny TelCom, just to see it fall when regulators came busting through the doors.
After fighting off regulators on every front, all that was left was Randy’s drive to build another company. Liberty International was born, and for years Randy run under the radar, creating a very successful company, with thousands of networkers earning their products and services for free, and several hundred became financially independent.
In 2009 – 2010 during the MLM Wireless Wars (you can read more on this site), Randy Jeffers and his team launched WOW Mobile, quickly taking on all the other pre-paid MLM wireless companies and dominating… for a short period of time. Soon, it was exposed that WOW Mobile through no fault of their own (except Randy didn’t see something in the fine print of his agreement between T-Mobile and himself), that both he and his LLC were responsible for all international calls maded by customers and reps of WOW Mobile. Long story short, Randy bankrupted the company, and distributors purport they are still owed missions in back commissions.
Randy, went on to help launch Liberty International network, and went back to creating a solid program, where thousands get their products/services for free, while a few long time leaders are still enjoying financial freedom.
Which brings up to the current MLM trend Unique Bid Auctions aka Penny Auctions aka Reverse Auctions. DubLi Network is the first such company to launch in the USA back in 2009 – 2010. DubLi slowed down to correct some of their early issues, and then focused on international expansion.
In 2010 Rex Venture Group, launched their penny auction house Zeekler, and in 2011 added Zeek Rewards, their Network Marketing affiliate organization to help market and advertise Zeekler. In nine short months, they quickly became the fastest growing, and largest MLM organization of any first year startup (source Network Marketing Business Journal) in modern history.
BidiFy launched in 2012, to become the first competitor of Zeek Rewards and is quickly coming on strong internationally. They have just launched their new penny auction house Bidsson.com and are growing steady in the USA as well as worldwide.
Today, July 4th, 2012, Randy Jeffers has opened for prelaunch his “Bids That Give” penny auction house and MLM Income opportunity (although Randy Jeffers is stating Bids That Give is NOT mlm).
Next week I will be doing a deeper investigation into the whole business model. But I do caution anyone who is looking at Bids That Give to fully understand a couple of concerns I have.
1. Although I personally do not think penny auctions fall under the U.S. Code of what is defined as a direct selling company, at this time that is the only reference point the regulators have to work with, and if any penny auction house is stating “we are not MLM” that is a red flag to be concerned with.
2. History has proven that when a for profit company (with a compensation plan) leads off with “giving to the needy” the SEC, FTC and State AGs feel the hair on the back of the neck’s start to prickle. Several very successful networker marketers have tried this in the past just to have regulators get involved. Randy is a smart businessman and has access to great legal minds, so only time will tell, but this is a red flag concern.
If you love the unique bid auction niche, and you are reviewing Bids That Give, just realize this is a young niche and is still very vulnerable to regulatory actions.
I have always enjoyed speaking with Randy Jeffers and have found he doesn’t back down from the hard questions. I look forward to chatting with him in the near future on this new venture.
Plus in seeing some of the growing pains the other auction houses have or are going through, just be very careful.
Over the last few months we have extensively covered Zeek Rewards the exclusive advertising and marketing arm of Rex Venture Group, LLC., and how they have literally pioneered the penny auction niche inside of network marketing. (To date at least five other penny auction houses are looking at network marketing), and one has already launched. Today I want to focus on Zeekler
I read a small interview put out by WFMY News 2 reporter Liz Crawford, and it caused me to look a little deeper into the auction and to get in contact with Alex de Brantes to get some of the behind the scenes facts and figures to match them what I could find publically.
I will start with what I found publically, then compare it against what Alex de Brantes shared with me. And for those who may not know, Alex de Brantes is the Internet Marketing Manager for Rex Venture Group, LLC., the parent company of Zeekler.com.
I went to Compete and Alexa to see how the traffic at Zeekler has grown. It was very easy to see that traffic had started to grow about the time Zeek Rewards took off.
In the above charts we see that the traffic started to take off in about December of 2011, but really started a geometric climb in February of 2012. Now, this doesn’t mean that all the people visiting the Zeekler site are active bidders. But it does show there is plenty of unique visits to suggest that there could be enough bidders to sustain the Zeek Reward compensation plan.
Now, let’s take a look at where the traffic is coming from. Once of the things critics and even some affiliates have asked, is are people bidding and using Zeekler.com for auctions. What I found fell inline with what I have studied about Unique Bid Auctions, both penny auctions and reverse auctions. (Click Here To Read Part 1 & Part 2)
Since penny and reverse auctions started in Europe it makes since that the unique visitors we are seeing landing on Zeekler.com would be from international locations.
Now what I found interesting, is that not all the traffic from Zeekler is from the top countries at ZeekRewards.com. Close but a little different. Which seems to point to the fact, Zeek Rewards affiliates are placing their ads and those ads are being viewed by folks who are visiting Zeekler.com to see what it’s about or to bid.
Something I realized in reviewing this information is the fact, I could not tell how many folks are actually enjoying the Zeekler Penny AUcitons, which is when I called on Alex de Brantes for some detailed info. Now, I did not focus all the way back from the beginning with Alex, I just asked for the most current info. I figured this will be a great benchamark since we now have at least one new MLM Penny Auction which has launched.
– Zeekler.com is now the #2 trafficked Penny Auction in the world. #1 is ranked at 909, and the next two most popular are ranked #30,306 and #501632.
– Total visits are up 4.3% – Unique visits are up 2.9% – Signups are up 2.85%
– Avg time on Site 7:20 – New Visits Converting 13.72%
Now what is very interesting in the above numbers is the converting figures. It is my understanding this figure is first time visitors who are looking around and deciding to bid in one of the auctions. Alex de Brandes tells me Amazon is the “gold standard” with a industry high of 17% of conversions.
Another interesting fact is that the amount of traffic visiting the Zeekler.com Penny Auction would fill the Dallas Cowboy Stadium 26x… That my friend is a boatload of traffic.
Well after a few date changes, BidiFy has finally officially launched their penny auction house Bidsson. Here at MLM Help Desk we started covering the penny action niche in the 4th quarter of 2011. But it was not until about Feb or Mar of 2012, that we started to see this niche fire up in the network marketing space. Today I know of at least five new network marketing penny auction companies who are funding to launch or already funded and are creating their sites. Today I want to look at BidiFy and Bidsson.
I first want to cover one concern I have with the BidiFy site. All in all they have done a great job, and Kevin Thompson their MLM Attorney has really tweaked and cleaned up their business model from our first review a few months ago. However, there is still one concern I have. I am reaching out to Kevin Thompson and a few other MLM Attorneys to get a better understanding of current laws.
Now when you read the explanation of the BidiFy Mandatory Account, my concern comes from the following:
“20% of all cash rewards earned in Bidify are paid as mandatory funds to your Mandatory Account. Funds in your Mandatory Account cannot be withdrawn as cash, instead it must be spent at the Bidsson site.
Funds in your mandatory account are transferred to Bidsson upon your request, by a single click on a button.
Purchasing Retail Bids to bid at auctions.
– Paying for your won auctions.
– Buying products at retail price directly from the Bidsson site.
– Paying for your monthly administrative fee in Bidify.
NOTE: Mandatory funds used to purchase Retail Products will generate PV and GV, and can also generate retail bonus to your sponsor.”
It is my understanding that when a company doing business in the USA, using a direct sales distribution channel, in this case network marketing, they can not demand that their sales/marketing force purchase or use their services. When a company makes such a demand, they may trigger both IRS rules regarding Independent Distributor status, and could trigger anti-pyramid laws at both a state and federal level.
Again, let me be clear, the laws may have changed, and if so we will be updating this post in the future. But, in years past, it has been very clear, you CAN”T demand independent distributors purchase products and services in order to earn commissions.
Outside of that one issue, things do look pretty standard, and the new penny auction site is a clean launch. I do need to make it clear, the money amounts on the Bidsson site are in Euros and not US Dollars, which may cause some confusion for bidders. So make sure you fully understand the conversion rates before making any form of purchase.
As some of you know when DubLi launched DubLi Network in 2009 here in the USA, I was not only skeptical I may have been one of the biggest critics. However, as I have reported recently, with their changes they made after hiring MLM attorneys, Grimes & Reese and other network marketing consultants, and merging into MediaNet Group, they went on to become the world’s largest online shopping and entertainment network marketing company in the world. But… What about the Reverse (Unique Bid) Auctions, do they really work?
Today, I really just want to focus on a few key points about DubLi (the shopping and entertainment) site, not DubLi Network the network marketing arm.
Now in case you have not watched the video above, I also want to disclose that John Benham, the Senior Director of Marketing at the DubLi Network is a close personal friend, and someone I have been in business with several times over the last couple of decades.
I can also say, it is through John Benham’s influence that I decided to take a closer look at DubLi and the DubLi Network after our initial coverage back in 2009.
Benham, sent me an email last week, and after studying it and working through the links, I found some solid info, that I feel based on the amount of folks who are investigating the unique bid auctions should be aware of.
– The biggest difference between DubLi and everyone else at this time seems to be the fact they have taken the reverse (unique Bid) auctions from being the leading product, and made them more of just an entertainment byproduct of the DubLi site.
Now with that said, it is clear that the reverse auctions truly seem to work…
– Shopping and entertainment are the biggest part. People can save up to 30% on the things they buy everyday from the retailers they already by from…. Apple, Walmart, Nordstroms, Target, etc.
– I did want you to know that 100% of our Xpress (reverse bid) Auctions sell below face value.
– DubLi is selling over 6,000 gift cards a day all below face value! These monies can be transferred to a DubLi e-wallet, DubLi Debit Card or your checking account.
– 100% of DubLi’s Unique Bid Auctions also sell items below value. (These are the Big Ticketed Item Above)
In my opinion DubLi.com is the standard all Unique Bid Auctions should be aiming towards. I don;t care if the auction house has an affiliate program or not!
Last week I received several private messages asking if it is true BidiFy is allowing bid purchases of $100,000.00? Since that was the first time I had heard of such a thing, I reached out to Kevin Thompson the Chief Legal Counsel for BidiFy. He sent me directly to Frode Jørgensen, CCO of BidiFy for the answers.
Below is the correspondence I received from Frode Jorgensen on this issue!
From: Troy Dooly [mailto:] Sent: Monday, May 28, 2012 4:18 AM To: Frode Jørgensen Subject: Frode, quick question
I have had a couple of messages come in from Facebook asking about a 100K max purchase of bids at BidiFy.
Can you tell me what your max purchase is allowed, and if you do allow a 100k purchase of bids?
Living An Epic Adventure,
Hi Troy, how are you doing?
We addressed these rumors in our latest newsletter I have added the part with the information you requested further down in this e-mail. There is NO such thing as a 100K limit.
I’m also pleased to announce that ALL Bidify affiliates have completed their Compliance Course, which is mandatory for ALL, at no cost of course.
New affiliates must complete this before they get full access to the site.
If interested I can send you a link for it, so you can check it out.
This have been active for over one month now, and is working perfectly. J Launch Smart are great people.
We had an amazing time with our top leaders in Thailand. We really enjoyed bonding with all of them and Chief Legal Counsel, Kevin Thompson.
We want to take this opportunity to address a bizarre rumor about our sample bid purchase limits. Apparently, Bidify is accepting million dollar purchases for sample bids! This is completely false. While we’re unable to prevent these sorts of rumors from spreading, we’re committed to providing you with accurate information when we receive word.
As we’ve said in the past, Bidify is not designed as an investment vehicle. In fact, if you’re looking for an “investment” with appreciable gains, Bidify is a horrible example. With 20% of all commissions going towards the repurchase of retail bids instead of cash, we’re fairly certain you can do better with your money elsewhere. Commissions in Bidify are driven solely by bid sales, which are never easy. And unlike our competitors, Bidify Affiliates are only paid when the bids are actually used by verified customers; thus preventing the ability for anyone to simply buy bids and accrue commissions with zero effort.
As you all know, we have been talking about a 10k limit on SB Purchases since the day we opened. While in Thailand with our legal counsel, we will be imposing a limit before we go live with Bidsson to avoid the model from being abused. While we certainly respect peoples’ ability to make their own decisions, there’s too much at risk if people purchase more bids than they really intend to move to customers.
So from today, we have decided to set the annual SB purchases limit at 25k Sample Bids. This limit does not include re-purchases made by setting re-purchase to on/off. Keep in mind, with each 1,000 bids, there needs to be a verified customer. And commissions are not cut until those bids are actually used, so if you’re looking to simply purchase sample bids and sit on them for qualification purposes, it’s not going to work here.
If you have any other questions, feel free to contact me at any time.
A few days ago we started looking at the Unique Bid Auction industry to better understand why network marketers from around the world are flocking to companies like DubLi Network, Zeek Rewards and BidiFy. Today I want to look at what the critics have to say about the Unique Bid Auction, and a little about gamification, one of the psychologies which could be attracting millions of folks to bid in the auctions.(Click here to read part one)
What is Gamification?
Gamification is known to be used interchangeably when talking about the three following terms: game design techniques, game thinking and game mechanics to enhance non-game contexts. In most situations gamification will apply to non-game applications (such as unique bid auctions) and processes (Facebook applications), in order to encourage people to adopt them, or to influence how they are used. (On a positive note, Evolv Health used gamification in their new Facebook application attracting 32,000 stories in the first 30 days, with 2.5 million impressions being shared worldwide, leading to their surge in new customers and distributors.)
Gamification can be described as, making technology more engaging (easier to understand and use). Guiding or encouraging users to engage in desired manner. Helping the user or programmer to solve situations while not being a distraction, And lastly and maybe the most interesting where it pertains to unique bid auctions, taking advantage of human psychological predisposition to engage in competitive (maybe addictive) online activities. Second Life, may be one of the first online communities to have utilized gamification, even though I do not think the term was around back at the launch.)
Here are some great research on gamification:
All the World’s a Game, and Brands Want to Play Along – Source – Ad Age Digital
“Basically game mechanics are a way to get consumers addicted to things,” said Tim Chang, principal at Norwest Venture Partners, which has backed many social mobile game companies. “They keep people engaged to keep doing things, as opposed to what goes viral quick: You click, you watch and then never see it again.”
One of the best examples is, of course, mobile social game Foursquare, which awards badges as users “check in” via their phones at physical places. Accumulating badges — and achieving statuses such as the “mayor” — are motivations to get people to check in.
Mr. Chang plots this trend on what he calls the “game-ification of life,” where competition and points are increasingly a part of offline activities, such as shopping with services like Gilt Groupe and Groupon and health and wellness with NikePlus.
Recently H&M ran the first-ever brand integration on MyTown, a mobile game like Monopoly set in the real world, created by developer Booyah. During the campaign, H&M was the most searched location within the game, 700,000 users checked in to its retail stores, and 8 million saw its virtual goods. The game, which has 2.3 million users since launch in December, has since worked with brands such as Travel Channel, Olay and Microsoft Windows. (Read the full article click here)
Jesse Schell, a game design professor at Carnegie Mellon University, generated a lot of chuckles this morning with his observations about that in his talk “Beyond Facebook” at the Dice Summit in Las Vegas.
Facebook games and others that use the “free to play” business model, where you can play a game for free and make money by selling virtual goods, hook their users via clever psychological tricks that convince you to buy things, either with real cash or by fulfilling some kind of special offer. These little incentives add up, creating a silly compulsion loop, forcing people to search for achievement points in everything they do. They keep playing because they get little rewards all of the time. Schell said that this trick will tie into other trends. (Read the full article click here)
Average age of gamers in years: 37 (has also been playing for average of 12 years)
77% of American households own videogames The average age of the most frequent game purchaser : 41 years
55% of gamers play games on their phones or mobile devices
% of youth playing computer & video games: 97 % of female gamers: 42 (In fact, women over the age of 18 represent a significantly greater portion of the game-playing population (37 percent) than boys age 17 or younger (13 percent).) % of gamers older than Fifty (2011): 29 (an increase from 9% in 1999; This figure is sure to rise in coming years with nursing homes and senior centers across the nation now incorporating video games into their activities.)
Percent of gamers who play games with other gamers in person: 65
91% of the time parents are present at the time games are purchased or rented.
68% of parents believe that game play provides mental stimulation or education, 57% believe games encourage their family to spend to time together, and 54% believe that game play helps their children connect with their friends. Avg. of hours/week played in WoW: 20
Gamers have collectively spent 5.93 million years playing World of Warcraft
# of articles in WoWWiki: ˜250,000
Rank of WoWWiki compared to all Wikis: 2nd
Rank of Wikipedia: 1st
Most popular games played by US soldiers in Iraq when off-duty: Halo, Call of Duty 46.6% of surveyed German employees playing games during working hours: daily, 10.0%; several times a week, 15.5%; once a week, 7.0%; once per month, 3.6%; less than once per month, 10.6%
61% of surveyed CEOs and CFOs are playing games during their working hours
Highest proportion of active gamers by country in percentage of the population (National Gamers Survey 2011):
Largest number of gamers are in China
Average number of game platforms that a gamer plays on: 3.8 Time spent gaming per day in the US: 215,000,000 hours
Examples of companies and industries using gamification:
Communicate Hope, which aided the development of Microsoft’s Office Communicator (now known as Lync). For this game, the goal was to get users to provide feedback on the product design and usability and to submit bugs. The game leaderboard was linked to five charities and Microsoft’s contributions to those charities was tied to the game results. Smith’s group got 16x more feedback from people playing the game than those not playing the game, and tens of thousands of dollars went to the charities.
Microsoft & Rochester Institute of Technology – Students who dropout early were less likely to have been woven into the social fabric of their school. Phelps proposed to create a productivity-style game around the “non-academic” aspects of college life and turn it into a “Hero’s Journey.”
Now think of how unique bid auctions work… Winner’s circle, competitively against others. Using free bids just to say you are the winner, these are all techniques we can find in other online businesses.
Now let’s look at what critiques have to say about the unique bid auctions:
But before you rush to sign up, you’d better understand how penny auctions work. The bidding starts at zero and goes up by only a penny each time. But you have to pay anywhere from 50 cents to a dollar to place a bid. And most penny auction sites make you buy a package of bids to get started.
“They’re very different from other auctions because you have to pay to play,” says Bob Schroeder with the Federal Trade Commission. “You could end up spending more than the value of the product you’re bidding on.” (Read the full article click here)
I was fascinated to discover the auction hybrid site swoopo.com (previously known as telebid.com). It’s a strange combination of eBay, woot, and slot machine. Here’s how it works:
You purchase bids in pre-packaged blocks of at least 30. Each bid costs you 75 cents, with no volume discount.
Each bid raises the purchase price by 15 cents and increases the auction time by 15 seconds.
Once the auction ends, you pay the final price.
I just watched an 8GB Apple iPod Touch sell on swoopo for $187.65. The final price means a total of 1,251 bids were placed for this item, costing bidders a grand total of $938.25.
So that $229 item ultimately sold for $1,125.90.
But that one final bidder got a great deal, right? Maybe. Even when you win, you can lose. Remember that each bid costs you 75 cents, while only increasing the price of the item 15 cents. If you bid too many times on an item — or if you use the site’s “helpful” automated BidButler service, which bids on your behalf — you’ll end up paying the purchase price in bids alone. For this item, if you bid more than 305 times, you’ve paid the purchase price — and only raised the cost of the item by $45.75 total. (Read the full article click here)
At first glance, Swoopo.com — which began in Germany as a phone and TV-based auction site called Telebid, migrated to the web as “Swoopo,” and launched its U.S. site last year — looks like an auction site patterned on eBay, with prices for most items starting at a penny and rising as members “bid” up the price. Like eBay, Swoopo has a full panoply of auction tools, such as comprehensive records of all completed auctions and an electronic bidding system (“Bid Butler”) that will put in last-second bids to keep you in the auction. Unlike eBay, however, on Swoopo you pay 60 cents each time you make a bid.
Sixty cents? Sure doesn’t sound like much when a $1,000-plus camera or computer is at stake. But consider the MacBook Pro that Swoopo sold recently for $35.86. Swoopo lists its suggested retail price at $1,799. But then look at what the bidding fee does. For each “bid,” the price of the computer goes up by a penny, and Swoopo collects 60 cents. To get up to $35.86, it takes a stunning 3,585 bids — and Swoopo gets its fee for each. That means that before selling this computer, Swoopo took in $2,151 in bidding fees. Yikes.
In essence, what your 60-cent bidding fee gets you at Swoopo is a ticket to a lottery, with a chance to get a high-end item at a ridiculously low price. With each bid, the auction is extended for a few seconds to keep it going as long as someone in the world is willing to take just one more shot. This can go on for a very, very long time. The winner of the MacBook Pro auction bid more than 750 times, accumulating $469.80 in fees.
Some of the ideas behind Swoopo have been explored in a theoretical way by game theorists. The reluctance of bidders to say goodbye to their “sunk cost” has been explored by economists such as Daniel Kahneman and Amos Tversky — and has been found to draw bidders deeper into the game. Swoopo plays off those insights to efficiently get people to make bad choices. It’s the evil stepchild of game theory and behavioral economics. (Read the full article click here)
Here’s a puzzler: How can a website sell a $10 Walmart gift card for 26 cents and still make money? Or sell an Apple iPod worth $100 for $3.30 and make an enormous profit? Welcome to the wild world of penny auctions, where nothing is quite what it seems and everything costs money — even the bids themselves.
Penny auctions have taken the Internet by storm. Ads for electronics products promising seemingly impossible 95 percent discounts appear on hundreds of popular websites. There are dozens of penny auction sites, with more popping up daily. One site, SkoreIt.com, recently engaged in an aggressive national radio campaign, bringing even more attention to this “new kind of auction.”
Penny auctions are run by for-profit companies that believe they’ve hit on a new formula that is entertaining and offers a real chance at deeply discounted merchandise. Of course, paying a little money for a chance at a big prize sounds like gambling, but supporters of the concept say that additional elements they’ve added differentiate the format from what might otherwise be called an illegal lottery. Some observers aren’t so sure.
“We call this entertainment retail,” said Jeff Geurts, chief financial officer of Quibids. He says the site runs 15,000 auctions per day, and will soon ship its 2 millionth product to a winner. “We look at shipping products as a measure of our success.” (Read the full article click here)
Well there you have it a little more on the whole unique bid auction industry.