Why it is a gem you ask? No, not because of the slim chance of winning the jackpot just shortly before Christmas, but because [...]]]> Sometimes it pays out to read the a-list blogs because you find something interesting. Like last week, when I was surfing around John Chows blog and found this gem: Peep Lottery

Why it is a gem you ask? No, not because of the slim chance of winning the jackpot just shortly before Christmas, but because the example this kid gives.

But first a short summary how it works:
Peep Lotto is a Twitter Lottery that makes money by tweeting sponsored tweets and placing advertisement on their own homepage. This money goes into a jackpot, that will be awarded to one lucky Twitter follower on Christmas day. The only thing you need to participate is a (free) Twitter account and to follow Twterlotto, no fee, no gambling or risk involved.

So why am I impressed with this guy? And why do I think this idea will be a success?

It is simple and it is viral!
All great business concepts that became a success, especially on the internet, were simple. Look at Google, Youtube or Digg, they are all based on a few “if-then” relations. In the case of Peep Lotto it works like this: If there are followers, then there are advertisers, if there are advertisers, then the jackpot increases quickly, if the jackpot increases, then there will be more followers, if there are more followers… You get the idea

It is free!
Free always sells, a free chance to win money sells even better. For advertisers this is an interesting approach, as people are tempted to check frequently how much the jackpot is now. That leads to more people visiting the web site and see the advertisements and possible click on it. The same is valid for the tweets. Sponsored tweets are only a few each day and always mixed with personal and / or interesting messages. People will be inclined to add this account to their Twitter lists as to  easier follow the story / progress. At the moment the account stats read: 1,490 followers and added to 46 public lists. That is an excellent relation between followers / lists and reflects only in how many public lists Peep Lotto appears, it doesn’t include the private ones. This stats make it a very interesting channel for advertisers and I venture to guess it will become even more attractive as time goes by.

It is personal!
There is actually a real person behind all this, not just a cool Web 2.0 style web site and a viral idea. By adding a blog and by tweeting about his life and his project, Peter Danihel, the site / project owner, adds a story to the product and gives it so a personal touch. He engages with the site visitors via his blog, and like every successful entrepreneur receives even his share on hatemail.

Negative points:
Missing disclosure of advertisement. From the web site “To the untrained eye, your advertisement will not appear an obvious advertisement; this ensures a more efficient return on investment.” Also searching around the home page didn’t brought up any policy, disclaimer or similar. Now, the web site owner is apparently located in Canada, which means he doesn’t fall directly under the new (from 1st December) FTC guidelines, but proper policy, disclaimer and disclosure pages would add a lot to the credibility of the site. I am not very familiar with Canadian internet laws, but my guess it that also they require a minimum of “legalese speak” on a web site that sells advertisement.
What will happen after Christmas? At the moment all is geared towards one date, Christmas Eve when the winner will be announced. I don’t know if Peter has any plans after that, but he really should start to think about how to build up on this momentum he has created and how to take his project into the next year. If not this will stay just an internet episode instead of growing into a long-term business for him.

Summary:
Following the Twterlotto Twitter Account is done in a few seconds and you might even be the lucky jackpot winner. The jackpot has now reached $1400+ and the follower count was 1490 last time I looked, which gives me a chance of 1:1490 to win Certainly better odds then a “normal” lottery.

But secondly, and more importantly, it is a great case study in viral internet marketing and by following the project and the discussion around it you might actually pick up one or two ideas for your own internet business!