Amway opens online store Fanista

Site to reward user referrals with commission system

By Ned Randolph -- Video Business, 12/14/2007

DEC. 14 | The parent company of multi-level marketer Amway has opened an online store to sell DVD, music and videogames with the same network techniques it uses to move soap, vitamins and beauty products.

Amway parent Alticor is the backer of Fanista, which opened its beta site Nov. 20, selling DVDs and music. It has since added videogames, including a game from Cyan Worlds sold exclusively on the site. In the coming weeks, Fanista will roll out music downloads, books and eventually video downloads, said founder Dan Adler.

Fanista adds a networking component to a traditional retail site. It asks shoppers to register. Then, if a friend lists the original shopper as his referral to Fanista and purchases something, the original shopper gets a 5% commission on the friend’s purchases. If the friend enlists someone else, both the friend and the original shopper get 5% commission on that person’s purchase.

Commissions can be collected by check, store credit or, soon, can be designated to a charity.

Adler said the referral stops after two because of the small margins in entertainment products and the need to build a broad, horizontal network.

The site is still in its infancy. Adler said all DVD titles are available on Fanista.com except adult titles. However, quick searches for new releases such as Shrek the Third and NBC’s hit series Heroes came up empty. But the new release Planet Terror was available for $20.98. Rocky cost $25.98, and The Big Lebowski was $9.98.

“The catalog includes new releases day-and-date with their release through other retail channels,” said Adler, who is a former Creative Artists Agency and Walt Disney Company executive.

Prices range from $10 to more than $25.

“We’ll obviously be merchandising around certain promotions, specific release windows, etc.,” Adler said by e-mail.

Adler said Fanista will be doing a targeted marketing campaign in Q1 2008 but offered few specifics.

“We’ll be in many of the places you’d expect to see us, based on our category specifically around entertainment and the various demographics we are pursuing,” he said. “We also are using street teams and will be launching a microsite in a few weeks.”

The former executive believes the Fanista model helps bridge the gap left by the demise of independent operators, from record stores to radio stations. Although studies show that books, DVDs and music are among the most successful product categories online, they also are the kinds of products with which customers actually value reviews and referrals, Adler said.

“What we grew up on doesn’t exist anymore. You used to be able to walk into a record store and find someone behind the counter who knew what they were talking about,” he said.

“In many ways, what Fanista tries to become is that trusted individual for you to grab their hand and walk into a really big store,” he said. “Let them guide you through their favorite genre. You know you love documentary films but don’t know what exactly you love. Now you realize there’s a whole other world out there.”