The Holidays! The Holidays!!
Then, and only then, should you read this update.
The first thing I do each morning is to check out the price of RWRDP. Traded on the 25th at $.18/share. (That’s up from $.16/share.) A great start to the day.
Then, I think through what we need to do to build the business to be bigger and better. We’re in the middle of analyzing the results of a member survey we just performed. We’ll dig into that a bit in this letter. One of the comments that was repeated was “more marketing”. To share some of what we’re doing in that regard, this month I’m going to discuss our PR (public relations) and IR (investor relations) efforts. Another frequent comment was “more stores”.
After that, I like to make sure we keep the SEC happy. To that end, we’ve just launched our rescission offer. I’ll discuss that, too.
Lastly, I’m going to recap the member acquisition math that we use every day. At this stage of our growth, I think they’re the most vital KPIs (key performance indicators) we have.
Unicorns and Surveys
A unicorn, in startup-world parlance, is a company that is worth over $1,000,000,000 (that’s a Market Cap of 1 Billion Dollars). Think Uber or Tesla. We’re not quite there yet as of 10/26/18:
I would really like iConsumer to be worth more than a billion dollars …
As part of our search for memorable marketing language, I was all in favor of referring to our journey to becoming a “unicorn”. Our lead marketing person said “too trite”. So we didn’t. But I’m stubborn, so we asked our member/investors in our survey (still not too late to finish yours) if they were familiar with startup “unicorns”. Not so much:
No offense to Lisa Frank
©, but we won’t be using unicorn language in our marketing efforts anytime soon.
If you haven’t filled out your copy (we emailed member/investors who have opted-in to our special newsletters a personalized link on Tuesday), please do so. We’re getting great response, lots of insights, and demographic data that will help us to better sell advertising and our other services.
Some of the questions were open-ended. I already know that we’re going to keep up, and maybe increase, our member/investor communications. Here’s why:
Number of Stores
We have over 1,900 stores now. With that many stores, even I find it impossible to keep track of each store. I rely mostly on the iConsumer Button. With the Button installed on my browser, I just Google what I’m interested in buying, the Button highlights those search results that are from iConsumer stores, and I click the link. Voila. I’ve saved money, and earned a bigger piece of the iConsumer pie.
I also use Amazon a lot through iConsumer. Walmart, too for that matter (I never used to shop at Walmart, but now they’re good competition for Amazon, and my purchases there are tracked directly to me, unlike Amazon). Purchases at Amazon make iConsumer money, which helps our profitability, and hopefully helps our stock price go up.
We take suggestions for stores we should add. Be sure to let us know any of your faves that we don’t already have.
One of the quick learnings from the member/investor survey is that our member/investors want iConsumer to be more visible. They believe it’ll help them as they spread the word about iConsumer (more familiarity and credibility). We agree. Early this month we retained a PR firm to help get us out into the public eye more. You’re never guaranteed results with PR, but we have a great story.
One of the first tasks for the PR firm is to help us make our story really short and sweet. I think the way we currently describe ourselves is a little too complex to be shared easily.
I believe that to be really successful, we have to make it drop-dead easy for our member/investors to share this story.
It’s equally important that the investment community is aware of iConsumer. Pitching stories to financial publications and investors is fundamentally different than to consumer-focused outlets. The firms that specialize in this kind of work are called Investor Relation firms. We hired one of those this month as well.
The goal here is to help support an ever-increasing stock price (but the price will still fluctuate up and down). Eventually, we’re going to consider the advantages of being listed on a stock exchange (think NASDAQ), as opposed to being quoted on the OTC market, like we are today. The regulatory compliance costs associated with being listed are much heavier than our costs for being traded on the OTC. The traditional advantage of being listed is a higher stock price and more liquidity for shareholders. It’s a balancing act.
Additionally, our investor relation firm will help to make us more visible to prospective investors.
Today, the SEC qualified our rescission offer. Because we didn’t have a qualified offering from February 13, 2018 through May 23, 2018 and we accrued the earning of shares, the SEC believes we need to offer member/investors the opportunity to rescind the shares and Bitcoin earned during this time period. While we don’t agree with them, it is far easier to make the offer than to argue. You can read much more about the offer here.
I don’t expect the offer to have a material effect on our cash position. However, if a lot of people do take us up on this, it will negatively impact our available cash.
As always, it’s a concern. We’re still not cash flow positive, so we rely on investors like myself to fund our operations. Once we have the first phase of our PR done (the tuning up of our messaging) it’s our intent to start spending money again on outbound marketing. That will be dependent on our continuing to be supported by our investors.
Member Acquisition Math
This is the most important math right now for iConsumer. How much cash does it cost us to gain a new member; how much cash does that new member generate for us; and how soon after they join do they generate cash (above & beyond the cash we spent to acquire them).
That first number – the cost to acquire, is typically called Customer Acquisition Cost – CAC. The second number is Customer Lifetime Value – CLV. The last number doesn’t have a name. In some industries (like rewards credit cards), it can take years for a customer to pay back their acquisition cost.
Right now, our CAC is less than $10. It’s too soon to truly know our CLV, but we’re estimating $75. What is very cool is that less than 60 days after the average new member joins, they’ve paid back the $10 we invested (they shopped enough so that they got rewards plus we made money after paying those rewards).
We’re currently selling stock at $.15/share. Last trade was at $.18/share. We’re investing your investment on marketing. We’re early stage, risky, and lots of fun. Be sure to read our offering circular for all the details. Visit here to invest.
P.S. Didn’t get the Lisa Frank reference above? Ask a millennial. That’s what I had to do.