Marketplace Theory and Dynamics. Frameworks for thinking about marketplaces based on 13 years as an operator and investor in companies like Upwork, Rev, OfferUp, Contently, and more.
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Teach your Users*
• Display Successful Transactions
• Reduce Variables
• Match new and repeat users
• Use community forums on your site
• Offer extra Q&A, Help and forums for newbies
• Make your help context sensitive
• Have clear and well defined policies
Marketplaces function best when users know exactly what to
expect and how to behave. There is a learning curve.
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Tiering Marketplaces
The best marketplaces know that you must segment users
and provide different experiences for different levels of users.
• When?—Once you can identify the classic 80/20 rule where
80% of the activity might come from 20% of your users.
• The goal of all this tiering structure is to reward and retain
your most active users.
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Virtuous Cycles
Attract Screen Optimize
Retain
Expel
Lots of time here
Ineffective
Not much time here
Very effective
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Liquidity Hacking
Find Aggregators
• Physical – office, campus -- Zesty
• Enterprise client – Gigwalk, Wonolo
• Scrape – Craigslist
Provide Value to One Side -- Github
Narrow your Focus -- OfferUp
Curation (reduce options) - YourMechanic
Brute Force (do things that don’t scale) - oDesk