Signify Classified - Internal

Introduction

• StickK.com was founded in 2007 by Jordan

Goldberg and Yale University professors Ian
Ayres and Dean Karlan in 2007.

• StickK allowed users to create commitment

contracts, in which they committed to achieve
a goal, or, if they failed, to (potentially) forfeit
money.

• With experience in the field of behavioural

economics, the founders hoped that the
financial incentives or rather stakes would
encourage people to achieve their goals.
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How stickK works?
Any new user would first have to
create an account with stickK by
providing some basic information.
Then go through the below simple
process:
• Step 1: Set a goal
• Step 2: Set stakes
• Step 3: Set a referee
• Step 4: Ask for support
By 2012, stickK had around 100000
users on its platform who executed
nearly 70000 contracts and most of
the goals were related to weight
loss programs.
How and Why StickK worked
Why stickK worked?
stickK applied the concepts of
behavioural economics to help
users reach their goal.
• The basic value proposition
was that the people who put
stakes (money or reputation)
are far more likely to fulfil
their contractual obligations
than others.
• With an impartial referee,
the users would be forced to
subvert impulses to renege
on their commitment.
• Around 80% of the contracts
with stakes succeeded and
the choice of recipient
affected the rate of success.
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STRENGTH
• High customer loyalty & repeat purchase
among existing customers
• Streamlined processes and efficient
operation management
• Strong Leadership team
OPPORTUNITIES
• Developments in Artificial Intelligence can • Growing dominance of digital players such
be used to predict consumer demand, cater
to niche segments, and make better
recommendation engines
• Lucrative Opportunities in International
Markets
SWOT Analysis of StickK
WEAKNESS
• The Business Model of Behavioral
Economics can be easily replicated by
players in the industry.
• Limited experience of international market
• Miss of dedicated workforce
THREATS
as Amazon, Google, Microsoft etc. can
reduce the manoeuvring space for
Behavioral Economics and put upward
pressure on marketing budget.
• Home market marketing technique won’t
work in new markets where scale is prized
over profitability
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StickK
How–and
B2CWhy
& B2BStickK
Profit worked
Analysis

Profit Analysis – B2C

• The total profit from B2C in 2012 is around $100 K. As the
customer base and contract volume have doubled from
2010 to 2012 and there is still large number of potential
customers in the market. With that StickK can anticipate
Profit could increase exponentially over the years in B2C

Profit Analysis – B2B

• Profit Analysis of B2B Business (Estimate based on 6 deals
a month). As start-up fees are largely devoted to software
development costs. Profit is mainly derived from monthly
administration fees. If we assume additional 2 account
managers and 2 developers are needed each year, the Net
profit from B2B is $74000 PA ($15000 PM * 6 Deals PA *
12 month PA - $85000 per staff @ 4 staff per year.
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Strategy recommendation for StickK

B2B provides a
predictable and large
revenue stream from
the monthly
administration fees and
the potential profit
from the business is
much higher than B2C
business with existing
The referral strategy individual customer
seems to be effective base (740K Vs 100K).
for now and if But B2B requires
customer growth rate Customised
Due to large organic slows down, stick programme, large time
growth potential for should also explore & effort to stabilize and
individual customers, its the other marketing less sustainable to
stable and established strategies such as expand. Hence StickK
platform, low operating Google Ads. to concentrate both on
cost and less support B2C and B2B and
required for B2C create separate
business, StickK should departments to handle
continue to expand B2C both channels, if
Business. needed