RealTime IT News

And Now, Netcentives Announces Its Patent

This reward-marketing patent business may well end up in the laps of the lawyers as first CyberGold and now Netcentives announced patents for various related technologies.

San Francisco-based Netcentives Inc., an Internet incentive, loyalty, and promotional marketing company, said it has been awarded a U.S. patent that covers online shopping rewards programs. The announcement follows a similiar statement from CyberGold three days ago.

Based on the strength of its patent, Netcentives also said it plans to more than double its investment in research and development, "expanding its technological lead in electronic commerce incentive and reward programs."

CyberGold said its patent gives the company the sole right to pay consumers online incentives--including cash, points, frequent flyer miles or other forms of compensation--whenever consumers demonstrate that they paid attention to an ad or marketing message or participated in an online loyalty program. CyberGold said earlier this week it plans to license its rewards-based "attention brokerage" apps.

Numerous other companies with the same twist on Internet marketing have yet to be heard from.

Netcentives said the patent gives the company ownership of intellectual property vital to Internet commerce-based "On-Line Interactive Frequency and Award Redemption Programs."

The patent gives Netcentives sole rights to a set of systems, procedures, and methods for providing online rewards programs in which consumers shop online, earn points or other units of value for their purchases, then redeem those points online for items from an award catalog.

Netcentives provides an online shopping rewards program ClickRewards, launched in March, via Internet retailers, including 800-Flowers, barnesandnoble.com, Macy's, Microsoft Plaza, N2K's Music Boulevard, Red Herring, SkyMall, and Yahoo!. The company also has exclusive partnerships that enable it to award frequent flyer miles with seven major airlines.

Netcentives just completed a new round of investment, adding an additional $17.25 million in funding from Integral Capital Partners (a member of the Kleiner Perkins Caufield & Byers family of funds), RRE Partners, Mayfield Fund, New Enterprise Associates, and Information Technology Ventures.