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Offline Method-X

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DAC + Referral Program = Viral Gold
« on: September 17, 2014, 02:24:10 PM »

Once a DAC is created, how will people find out about it? For most DACs, it won't be enough to rely on the "if you build it, they will come" strategy. So why not leverage the religious community cryptos tend to create and transform them into an army of affiliate marketers?

A referral program (otherwise known as an affiliate program) is a performance based commission system that allows anyone to promote a product and make money proportional to their ability to continuously generate new business.

Since running a DPoS blockchain is extremely cheap, income generated by the DAC can be reinvested in referral payouts, as opposed to burning it. A decentralized autonomous marketing scheme for a decentralized autonomous company, allowing a DAC to autonomously perpetuate itself virally.

If the DAC is selling goods for BitUSD (i.e. decentralized marketplace like Open Bazaar), this would allow for a completely traditional referral program to be implemented. If the user makes a purchase within X number of blocks, the referrer gets a percentage of the fees incurred from the sale.

From a technical perspective, this would be no different than how any other referral program is implemented. I can't think of any way this could be abused other than users buying goods through their own affiliate link, which is easy to prevent and has never been a problem in real world use cases.

The point of PoW mining is to distribute tokens fairly and buy security for the blockchain. Since DPoS solves the security problem, that allows us to think of creative ways to distribute tokens and possibly use inflation to buy things other than security.

For example, inflation could be used to buy marketing. The better you are at generating sales for the DAC, the more shares you'll receive; analogous to block rewards for providing security. This makes for a much better value proposition than mining with useless hashing power. Inflation is, of course, optional. Income generated in the form of fees could be used exclusively.

Not all DACs will be as lucky as BitShares X. They won't have as strong an incentive to use them as  BitAssets and BitYield allow for. When viewing a DAC as a company and not a coin, it makes perfect sense to incentivize and automate the marketing process. Generating new business is an essential part of any company, DAC or otherwise.

The importance of referral marketing on the Internet cannot be understated. Ads and referral programs are the incentive structures that make for sustainable online businesses. If a DAC is ever expected to compete with traditional online companies, it needs an autonomous mechanism to spread itself virally. At the very least, this is an idea worth putting more thought into.

If you're a developer and wish to speak privately, contact me @ methodx[at]gmail[dot]com
« Last Edit: September 17, 2014, 02:58:21 PM by MeTHoDx »

Online santaclause102

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Re: DAC + Referral Program = Viral Gold
« Reply #1 on: September 17, 2014, 04:19:21 PM »
Maybe something for a DPOS chain without any additional function. Wouldn't put that out in the wild though atm. ONnly when Bitcoin someone & the Bitcoin foundation decides to make a DPOS chain that honors bitcoin holders 1:1.

There is a third possibility besides hard coding the referral reward and having one or more delegates run a referral program (current model): The DAC workers proposal by Agent86 which is interesting https://bitsharestalk.org/index.php?topic=4660.0




Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #2 on: September 17, 2014, 04:52:07 PM »
So the only thing complicating this right now is the lack of a widely accepted DPoS currency. I was under the impression the ability to send tokens from chain to chain was in the works?

Offline robrigo

Re: DAC + Referral Program = Viral Gold
« Reply #3 on: September 18, 2014, 01:38:21 PM »
I agree with you that referral programs are a very powerful way of driving people to interact with services online. I haven't considered building the referral program directly into the DAC, but perhaps the delegates could have a 3 way slider to facilitate the referral fund if this ever did happen. Because this idea depends on being able to purchase stuff with BitAssets, maybe this would be better received a little further down the road.

I am interested in building a learning platform referral program to give people incentives for learning about the fundamentals of crypto-equities, blockchain technology and eventually specific projects (BitShares ecosystem would be my first focus). These lessons wouldn't necessarily have to be super technical, but more about introducing the overarching concepts and why they matter. I think wider adoption will happen when people understand what they are interacting with better.

Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #4 on: September 18, 2014, 03:07:27 PM »
I think many people are resistant to this idea because it changes the current paradigm of what a DAC is (to them). Having thought this out more, I'll give a clearer example of how I envision a referral program working.

Lets say we create a Poker DAC and the internal currency (and shares) are PokerChips.

UserA refers UserB to the PokerApp. UserB downloads the PokerApp and registers his account name to the blockchain with UserAs referral code.
   -The referral code can be the users account name that referred you.
   -UserA is logged in the blockchain as having referred UserB.

UserB plays PokerApp and wins 100,000 PokerChips.
   -The PokerApp blockchain takes a 1% cut (1,000 PokerChips).

UserA is rewarded 1,000 PokerChips.

Is there some fraud potential with this? Sure, every system involving money has fraud concerns. That doesn't mean we should just give up and forget about a referral program.

I am interested in building a learning platform referral program to give people incentives for learning about the fundamentals of crypto-equities, blockchain technology and eventually specific projects (BitShares ecosystem would be my first focus). These lessons wouldn't necessarily have to be super technical, but more about introducing the overarching concepts and why they matter. I think wider adoption will happen when people understand what they are interacting with better.

And with a referral program you and thousands of others would suddenly be financially motivated to teach as many people as you could why BitShares is important and how to use it. An army of educators would instantly be at the DACs disposal.

Offline donkeypong

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Re: DAC + Referral Program = Viral Gold
« Reply #5 on: September 18, 2014, 04:41:19 PM »
It could be powerful. I would love to see a referral network. But I think you're right that some of the technical DAC people are less interested in developing the business side to its full potential. Heaven forbid we involve any real people or contracts! One also would need to think through the fraud issues. Is a referral based on deposit size or address, etc.? Because one person can have many addresses. A big depositor could refer him/herself. So I think a referral bonus structure would need to incentivize referrals, yet keep the reward fairly modest.

Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #6 on: September 18, 2014, 06:37:31 PM »
It could be powerful. I would love to see a referral network. But I think you're right that some of the technical DAC people are less interested in developing the business side to its full potential. Heaven forbid we involve any real people or contracts! One also would need to think through the fraud issues. Is a referral based on deposit size or address, etc.? Because one person can have many addresses. A big depositor could refer him/herself. So I think a referral bonus structure would need to incentivize referrals, yet keep the reward fairly modest.

I'm glad somebody sees the potential of this. So, what you're saying is: there's nothing preventing UserA from also being UserB. This is true. It's also not a problem. From the networks perspective, it doesn't matter who is being paid; only that it's generating revenue. If a savvy user wants to refer himself and save money on fees let him.

In the real world, this is a problem all affiliate networks have. If I'm an affiliate for Amazon, I can buy products through my own affiliate link / referral code. The best Amazon can do is require I make X unique referrals before I'm entitled to a payout. This is actually what most affiliate networks do in the real world.

All that aside, I've run many affiliate programs of my own for the past 8 years and this has never been a problem. I would guess about half a percent of my sales are bought through ones own affiliate link/code. And even if it WAS a problem, I wouldn't care so long as I'm making a profit. The point of a referral program is only to incentivise advertisers.

Come to think of it, the whole reason I'm so drawn to the notion of a DAC is because I've been creating semi-autonomous companies since 2006. The thing that makes them autonomous really all boils down to the affiliate program.

Advertising is what gives a company value.
« Last Edit: September 18, 2014, 06:44:16 PM by MeTHoDx »

Offline carpet ride

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Re: DAC + Referral Program = Viral Gold
« Reply #7 on: September 18, 2014, 06:43:27 PM »
Could we refer people using Facebook? Rewards would only be distributed if the referred person has over 200 friends and a "seasoned" account

Other ides for proving unique sign ups?
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Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #8 on: September 18, 2014, 06:52:20 PM »
Could we refer people using Facebook? Rewards would only be distributed if the referred person has over 200 friends and a "seasoned" account

Other ides for proving unique sign ups?

This is completely unnecessary. A DAC with an affiliate program will not face any problem a traditional affiliate program doesn't already face. You guys are over thinking this WAY too much.

EDIT: When you buy a product on Amazon, do you buy it through your own affiliate link? Probably not but there is nothing preventing you from doing so other than a headache and the fact 99% of people don't know they can do it. And ultimately, Amazon doesn't care because to them, the sale is still profitable.
« Last Edit: September 18, 2014, 06:58:16 PM by MeTHoDx »

Offline donkeypong

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Re: DAC + Referral Program = Viral Gold
« Reply #9 on: September 18, 2014, 06:57:52 PM »
Could it be a stand-alone third party site like a coupon or incentive program? It wouldn't need to be profitable, just break even. Or would it need to plug into BitShares X for the account info? If it were the former, someone like you might create something, and I'd gladly help you. If it needs to plug in directly to the code, that's where I think you'll hit a roadblock. There are a limited # of programmers working on BTSX and they'd probably much prefer to work on other aspects of it.

Offline Shentist

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Re: DAC + Referral Program = Viral Gold
« Reply #10 on: September 18, 2014, 06:59:46 PM »
I think many people are resistant to this idea because it changes the current paradigm of what a DAC is (to them). Having thought this out more, I'll give a clearer example of how I envision a referral program working.

Lets say we create a Poker DAC and the internal currency (and shares) are PokerChips.

UserA refers UserB to the PokerApp. UserB downloads the PokerApp and registers his account name to the blockchain with UserAs referral code.
   -The referral code can be the users account name that referred you.
   -UserA is logged in the blockchain as having referred UserB.

UserB plays PokerApp and wins 100,000 PokerChips.
   -The PokerApp blockchain takes a 1% cut (1,000 PokerChips).

UserA is rewarded 1,000 PokerChips.

Is there some fraud potential with this? Sure, every system involving money has fraud concerns. That doesn't mean we should just give up and forget about a referral program.

I am interested in building a learning platform referral program to give people incentives for learning about the fundamentals of crypto-equities, blockchain technology and eventually specific projects (BitShares ecosystem would be my first focus). These lessons wouldn't necessarily have to be super technical, but more about introducing the overarching concepts and why they matter. I think wider adoption will happen when people understand what they are interacting with better.

And with a referral program you and thousands of others would suddenly be financially motivated to teach as many people as you could why BitShares is important and how to use it. An army of educators would instantly be at the DACs disposal.

great idea!

how could it look in BTSX?

we have not a BTSX fund so far to pay something out. so why not take a piece of the tradingfees for the referal?

something like if i use the client you spread you will get a lifetime cut of the fees - 5%

with this kind of incentive real affiliates will make in the future great profits and scammers with fake accounts will earn nothing.

Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #11 on: September 18, 2014, 06:59:49 PM »
Could it be a stand-alone third party site like a coupon or incentive program? It wouldn't need to be profitable, just break even. Or would it need to plug into BitShares X for the account info? If it were the former, someone like you might create something, and I'd gladly help you. If it needs to plug in directly to the code, that's where I think you'll hit a roadblock. There are a limited # of programmers working on BTSX and they'd probably much prefer to work on other aspects of it.

This is not an idea for the BitShares exchange. It's a business model for other DACs built on separate blockchains.

Offline donkeypong

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Re: DAC + Referral Program = Viral Gold
« Reply #12 on: September 18, 2014, 07:06:08 PM »
Gotcha. I'd seen you mention that earlier and had forgotten. For other DACs, I'd suggest contacting the developers (toast, cob, etc.) and see if they're interested.

Offline carpet ride

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Re: DAC + Referral Program = Viral Gold
« Reply #13 on: September 18, 2014, 07:16:26 PM »
Could it be a stand-alone third party site like a coupon or incentive program? It wouldn't need to be profitable, just break even. Or would it need to plug into BitShares X for the account info? If it were the former, someone like you might create something, and I'd gladly help you. If it needs to plug in directly to the code, that's where I think you'll hit a roadblock. There are a limited # of programmers working on BTSX and they'd probably much prefer to work on other aspects of it.

This is not an idea for the BitShares exchange. It's a business model for other DACs built on separate blockchains.

Can you say for certain that it would not work in BTSX?  Even for a particular bit asset?
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Offline Method-X

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Re: DAC + Referral Program = Viral Gold
« Reply #14 on: September 18, 2014, 07:21:14 PM »
Gotcha. I'd seen you mention that earlier and had forgotten. For other DACs, I'd suggest contacting the developers (toast, cob, etc.) and see if they're interested.

I contacted Dan and gave him a brief overview but he didn't respond. I'm sure he's quite busy with the exchange at the moment.

 

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