Q: When do you expect to show an uptake in subscription revs? A: This will be detailed in the annual report early Jan …. But we are up 25% in membership since Nov. 1st.
Also: “Our company is very well capitalized… no longer a start up business… in absolute growth and acquisition mode… and we are well positioned to take advantage of that.”
“Acquisition targets: We are actively looking for companies wanting to grow, but which need money for that stage. We can do it for them. We also look for companies which are strategic fits, value fits, and have a decent demographic customer base.
“We are aggressively looking for acquisitions now, and over the next twelve months you will see us more active in this department.”
“We are looking for additional people to help us grow, to take us to the next level.”
Milestones to watch for in 2006:
No.1 - Acquisitions
No.2 - Revised website in 1st quarter, after the holidays.
No.3 - Scientific assessment and deployment of marketing and advertising, sales channels.
No.4 – Physical expansion and DC’s- part of the whole thinking and plan
No.5 Staying on top of the evolution of the online rental business, including electronic delivery methods. We are aggressively looking at this, keeping in mind the acceptance and use of such technology
No.6 - European expansion
No. 7 – Being ready for new technologies and platforms, ahead of time.
Closing Remarks:
“GZFX is no longer a start up business.” Infrastructure, both Delivery and I/T, are in place and growing, CC and new marketing partner relationships are now fully rolled out or being worked on. Everything is in place to take off. Growth rates are great. Churn rate is reflected in customer retainment. Now we will focus on strategic growth, measured.
“We are in SMART growth mode.”
GZFX WEBCAST HIGHLIGHTS FROM OCT...
17% of members request movies only. 66% requests both games and movies. 23% are pure gamers.
Ad Campaign:
Opt Email Pop up ads Sponsorship and Endorsement program. Considering at Florida, Texas, Northwest, Midwest, and Hawaii. CSTV agreement targeting college students going to campus in 20 major universities (Nov 1st). Online advertising 10 - 20 million impression in the 4th quarter. Male oriented websites: IGN, Hollywood, Mensfitness, Road & Track. Advertising will not get ahead of inventory and growth!! Redirecting to online marketing. No plans to move into TV yet. GOOD!
Market Research and development:
Direct download pay per view basis. Revenue sharing to maintain all copyright in relation to inventory. UK expansion moved to late 2006 to focus the circuit City opportunity. 17% of members request 100% movies on the gameside. 66% requests games and movies. 16.5 million of funding 75% will go to inventory 25% advertising Reviewed by auditor
Operational Capacity:
New mailer performed better than expected. Ship thousand of titles only 3 - 5 have been broken. Delivery time now averaging 48 hours and 24 in the proximity of distribution. Along with Ingram entertainment: Signed 2 new distributors: baker & taylor, VPD. Inventory leveling like Netflix to pull out of stock inventory from the next closest distribution center Prebooking titles (new releases) at minimum of 6 weeks stock.
Circuit City Relationship:
Store managers have been trained. Significant store promotion Products will be in store Nov 1st. Gameznflix will also be online on CC website. Gameznflix will be on the CC circular to 50-100 mil households across the country (profit / membership projected to jump). No Plans to going to Canada as of now.
Website makeover:
Updating website in the next few weeks. Separate section for each platform. Improving search feature with more options. Cross-promotion in website. Web infrastructure is in place ready for the spike.
Acquisition outlook:
Looking at all acquisition, other direct download companies, movie companies, game companies.
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