With a “well-dispersed” demographic that includes a 20 percent female base, Wanted List discreetly mails more than 1.5 million DVDs to its thousands of customers annually, making it one of the largest online retail operation for adult DVD rentals in the world.
Customers can choose from more than 15,000 titles available from more than 170 studios, with offerings from the mild (Playboy Video) to the wild (Anabolic).
Netflix imitators are numerous, but Wanted List has been on the scene since 2001 when Tran, 29, and partner and co-founder Ting decided that they wanted to create a business for themselves.
“You get bored in corporate America,” Ting, 31, CEO of the four-year-old company, says. “We both wanted to do something outside the world of consulting.”
Tran, CFO of Wanted List, concurs. “I didn’t want to work for anyone else,” he says. “I wanted to build something with my own two hands.”
Ting and Tran, who hold dual degrees from UCLA and Carnegie Mellon University, sought out venture capital money from the traditional avenues they were accustomed to based on their corporate background. But potential investors either backed away because of the adult nature of the proposed operation or, as Tran says, “they wanted too much bang for their buck.”
“We raised the money ourselves,” Tran says. “We leveraged a lot of credit cards and bank loans and just fought our way through to today.”
Ting, who is responsible for managing the company’s operations and technology platforms and delivering on Wanted List’s corporate strategy, agrees. “It was very organic. Look at us now and look at where Enron is now. From an original two-man operation, the company has really blossomed.”
When Ting and Tran first set out to promote the Wanted List brand in 2001, spamming as a means of promotion was a dying model.
“People were spam happy in the 1990s,” Tran says with a gentle laugh. “Some companies made their entire name and fortune through spamming. But by 2001, you really couldn’t do that anymore, so in came the era of pay-per-click engines.”
In the beginning, Tran says, the partners relied on word of mouth, pay-per-click engines, and some very expensive and targeted email campaigns — not spam — as well as message boards and direct interfacing with the media to get the word out about their company.
“It was very targeted marketing growth from the get-go,” Tran says. “Over time, we generated some money, and then we were able to do some very legitimate marketing campaigns.”
Today, Wanted List has three offices, with a fourth soon to be opened in Canada. The company’s slim staff of 30 employees includes everything from warehouse personnel to tech engineers and designers. The company currently has two shipping operations, one in New Jersey and one in Southern California, where all orders are shipped by FedEx.
Wanted List does not ship internationally, and for the time being, will only ship within the U.S. (including Hawaii and Alaska with an extra day for transit time) with several self-imposed restrictions: No adult DVDs will be mailed anywhere in the states of Alabama and Tennessee, and there are restrictions on several ZIP codes in 10 other states, including Oklahoma, Ohio, Utah and North Carolina.
Wanted List offers multiple pricing plans, from $17.95 for two DVDs at a time to the top tier $42.95 for eight titles at a time. Like Netflix, Wanted List customers select the movies they would like to see and then put them in a DVD wish list called My Queue. They then receive their selected titles (two, three, four, six or eight movies at a time) depending on their plan. There are never late fees, and a postage-paid envelope is included.
The catch to Wanted List’s model is that the more titles the customer has in his or her queue, the greater the likelihood that the customer will always have the full number of discs (according to the selected pricing plan) in their possession. In fact, in their FAQ, Wanted List encourages customers to keep “at least 10-20 movies in your queue at all times,” hence the term “revolving rental.”
Netflix, however, claims that it first patented the process of queues and DVD wish lists and revolving rentals in June 2003 and has accused Blockbuster of illegally copying its concept in a patent infringement lawsuit filed in U.S. District Court in San Francisco in April.
If Netflix prevails in the litigation against rival Blockbuster and its patent is upheld, it could run its imitators like Wanted List out of business or put them in the position of becoming paying licensees. Neither Ting nor Tran is concerned with that possibility.
“Our formal corporate stance on this is that we are just going to wait and see what happens,” Ting says.
Blockbuster, Tran says, “has announced that they will fight this to the bitter end,” and he invokes the Acacia debacle as an example of “people trying to patent ridiculous things.”
Both Ting and Tran believe that Wanted List is more than just an online revolving rental business for blue movies in the privacy of your own home.
“Our whole philosophy in terms of marketing ourselves, getting out there and acquiring customers and sustaining ourselves, is really bringing fans into the world of adult,” Tran says. “For a long time it seems that fans were really being kept at arms-length.”
To that end, Wanted List has hosted a series of online contests to boost brand awareness. Past contests have included Win a Date With Gina Lynn, The Ultimate Porn Party Contest (in partnership with Co-Ed magazine), Direct a Madness Picture Contest and even an opportunity to be an extra in a Vivid Video production. And this year, in conjunction with Adam & Eve and Magna Publishing (publisher of Genesis and Swank), Wanted List launched the first ever FAME (Fans of Adult Media and Entertainment) Awards.
“It is purely a fan-based award,” Ting says, “and I think that is what’s important — that the fans get to speak out.”
When Wanted List opened FameAwards.com, a venue for fans to go online and vote for their favorite stars, Ting and Tran received 1,000 registered users per day.
If Ting expresses a lack of alarm or concern over the Netflix patent flap, he is even less worried over the debate about where content delivery platforms are headed. He does not believe the Chicken Little shouts that DVDs are dying and, for validation, points to DVD sales charts, home entertainment sales or just the available bandwidth in the U.S. alone.
“There was a study released recently that if Netflix streamed all of its movies to customers within the continental U.S., we would run out of bandwidth in 15 minutes,” Ting says.
Tran agrees: “The people who are going to video-on-demand sites are a completely different type of user. They are the early innovators, the early adapters in the product-diffusion curve.”
And as consumers begin to depend on the discreet online services of businesses such as Wanted List, XRentDVD.com, Adult DVD Empire and URentDVDs.com, they will continue to crave the physical product, Ting believes, not streaming video.
“If I just paid $3,000 for a 50-inch plasma TV, with another $1,000 on a surround sound system, I want to use those devices to watch a DVD. I don’t want to sit in front of a computer monitor to watch my porn.”