Disruption refers to the act of breaking equilibrium. In the old time, people go out an hunt animal everyday. Their routine is in equilibrium. Then along come agriculture, which disrupt their routine. Just like agriculture, online recommender communities would disrupt the current business model called Antelope Hunt Business Model.
Antelope Hunt Business Model
Members of an online community find the community by themselves, pay the monthly fee for the privilege of being in the community (possibly for a year or longer), share search and information with other members.
By now, you might wonder who would want to pay for monthly fee, just to be in the community. Well, read along and you will see that the community is a platform where only the members earns money while solving their pain.
Benefit Number 1: A Pain Solver
A recommendation online community is borned from pain. Each member of the community share pain and would be delighted if the community can help them relieve the pain. The pain arises from, for example, time needed to look for what they need. If they are not able to find solution, they will have to put up with what the vendor offers in the market. The first benefit of an online recommender community is to help member solve pain.
Benefit Number 2: A Transfer of Wealth
An online recommender community can act as a revenue generating platform for the members. Again, this is the place where the member rate, review, and recommend products. There are 18 revenue channels, which are the result of the members' actions. The community should share a part of its revenue with members to motivate the member to create more valuable content.
Cost of products consists of production cost and marketing cost. An online community can leverage the marketing cost by doing the marketing for product vendors. The conversation of members can be sliced, diced, and then sold anonymously to the vendor. The vendors will, in turn, benefit from market cost reduction.
Apart from 18 revenue channels discussed earlier, product branding is another one. When a company wants to launch a product, it can hire the community to survey the market, draft a plan, and come up with a fair pricing. The community rates, votes, or even design new products for the company. A community can even sell its brand to the company. The consumers who appreciate the community are likely to purchase the product with community's brand.
Privilege of Being in a Community: Viewing or Creating the Content
Being in a community gives members two above benefits. The former one, pain solver is pretty obvious. Members benefit from truthful information from other members.
But the interesting is the latter one: A revenue generating platform. Here, the privilege is not for viewing the content, but for creating the content. The member can use the community as a marketplace where they can offer their content for sale. The high-quality content will get picked and purchased by the community, product vendors, and/or other members.
The Endowment Effect
People often things they own more than things they do not own. The value of a house depreciated as time elapses. Yet, the owners often refuse to sell their house at the depreciated price.
Similarly, when people become a member, they tend to stick around. It is easier to keep the member in the community, than to persuade people to become a member. But it is also important to give member a glue factor such as lockers, closets, watch us grow page. See [here] for the elaboration of glue factors.
Source: Social Network Business Plan by David Silver, Chapter 6.
About the summary: It takes time to finish up a book. And, when you do, how would you review what you learn from the book. Flip through the books? What if the book is audiobook? You might have to go over the book again. Not plesant.
The summary here contains insights I grasped when I read the book. It will tell you what to expect of the book. Giving key insights and the organization of books, the summary makes it easier and more entertaining when reading the book.
What the summary does not give you is the details (e.g., business cases, anecdotes) and entertainments. So if you think this book will entertain you, you may buy it online here. Also you might want to check out the review of the book which shall be up soon.
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