SaaS Interviews with CEOs, Startups, Founders
Convincing Affiliates To Market For You with Sean Wycliff of DealFlicks Ep 14
28 Feb 2016
Chapter 1: What is the main topic of DealFlix and its unique approach?
This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base. You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per top. Five and six million. He is hell-bent on global domination. We just broke our 100,000-unit soul mark.
And I'm your host, Nathan Latka. In the last episode, you heard from Christian Johan Smith, who almost lost his car to the Pacific Ocean in a very scary story and went on to raise $1 million via an Indiegogo crowdfunding campaign. All right, Top Tribe, our guest today is Sean Wycliffe. Now, Sean is the founder and CEO of DealFlix. They're currently partnered with over 600 U.S.
theater locations, including 13 of the top 50 U.S. theater chains. They're doing something very unique and their annual revenue run rate has surpassed $3 million on 2X year-over-year growth. You guys are going to love this episode. We're going to dig in. Sean, the top tribe is ready to learn from you. Are you ready to take us to the top? Yeah, let's do it. All right, man. I love it.
So first off, anything in the bio that I missed that you think the listeners need to know?
Yeah, I mean, it's been a ride. I think a lot of times nowadays, DealFlix, we're not profitable yet, but things have been going well. We've raised some money. We're generating revenues. We're getting there. And so a lot of times people think that it's an overnight thing. And I also talk about how I just graduated from college in December 2010 and had the idea for DealFlix after that.
But sometimes it gets lost that I had dropped out of school for five years before that and had another business venture before that. And so I've been an entrepreneur for a little bit. and it has taken some time. There's been some failures along the way.
And so if you're out there and you're trying something and it's not going as fast as you'd like it to go, don't worry, you're in good company because that's most of us.
So how old are you now, Sean?
I just turned 32 a few months ago. So I am getting up there now. Sometimes people look at me and think that I'm still 18, which is great now. But when I was in high school, it wasn't that great for dating, but it's worked.
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Chapter 2: How did Sean Wycliffe initially market DealFlix?
Do they come out of your 15 cents or the theater's 85 cents?
Yeah, so this is where it's really interesting. So initially, when we were building our affiliate program out, we were looking at... We would have to pay them out of our 15 cents. And it was just not enough money to make anyone interested in this whole thing. So the way that we're doing it, we're actually paying $4 per affiliate transaction, which is more than we make.
So we might make, let's say, $2 on average, but we're paying them $4. So we lose every time that happens. But the thinking is... a customer will come back and they'll make multiple purchases over the course of a year. And then we'll make that back on the long-term value.
Now we've had top tribe members before when we've had SAS entrepreneurs on, like in our episode, when we had Peter shallered on in episode number three, where he built a SAS business, we talked about lifetime value. So you're talking about this affiliate transaction. You lose money on the first sale, but they're bringing you a customer.
You're okay doing that because it sounds like you have some confidence in your metrics around lifetime value of the customer. What is the lifetime value of a customer to you?
Yeah. So the lifetime value of your customer, the way that we see it, our customers will continue to use the service over the course of the year and the next two or three years. So over the course of one year, they might make four purchases. That's kind of where it's been.
Wow.
And so, yeah, we might see eight bucks off of them the first year, but then they'll buy it for the next year and the Third year. So we, we estimate right now our, our lifetime value comes out to about 24 bucks over the course of three years, but we haven't spent too much time trying to get them to purchase more. We were still in growth mode, just adding more theaters and more customers.
Um, so right now it's about $24. I think in the long run, we could probably get it up to maybe about $50.
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