Why would anyone start using Loladex? We get asked this question a lot.
I’ve posted before about the chicken-and-egg issue, albeit in general terms. Probably I should update those thoughts: Since we started focusing on social networks, we’ve learned a bunch.
But for now, let me address Loladex’s specific challenge: How do we motivate people to rate local businesses via a Facebook application? Why would anyone do such a thing?
Well, for many reasons, of course. One day I’ll list them all. But I’d like to highlight one reason in particular, partly because I think it’s powerful and partly because it illustrates a big difference between Loladex and two of its biggest competitors — Yelp and Angie’s List.
Here it is: Loladex believes people will rate local businesses to help their friends.
By friends, I mostly mean actual, real-world friends. People you might have dinner with. For most folks, that’s a subset of “Facebook friends.”
Let’s get specific. Why would anyone use Loladex to rate, let’s say, a plumber? Or a pediatric gastroenterologist? Certainly it’s not something you do on a whim. Loladex won’t be running ads that say “Rate pediatric gastroenterologists!” — and if we did, we wouldn’t expect many clicks.
But suppose you were asked directly by a friend whose kid needed a medical specialist? If you knew of a good gastroenterologist, would you take a minute to make the recommendation? If you were seeking such a specialist, would you value this sort of recommendation?
We think so. Such recommendations are an everyday part of friendship, and numerous surveys tag them as a more powerful force than the Yellow Pages, a $14 billion industry.
With Loladex, we want to provide a channel for these person-to-person recommendations.
Contrast this to Yelp. I always say I like Yelp — and I do — but Yelp isn’t about helping your real-world friends. By and large, the people who rate businesses on Yelp do it for reasons of (a) self-expression; and (b) social standing in an online community that may overlap with their real-world friends, but doesn’t have to.
These mostly twentysomething Yelpers provide a service for us all, God love them. But it’s almost never a person-to-person transaction. Also, the motivation to rate something on Yelp fades quickly outside its core realm of restaurants & other social venues.
Or consider Angie’s List. I’m not a fan of Angie’s List, simply because it’s a subscription service. If it were free, I’d love it. They’ve built something that’s clearly valuable to their users — and they’ve focused their brand admirably, defining it around home services.
Again, though, Angie’s List isn’t about helping your real-world friends. It’s mostly a community of cooperating strangers who share ratings because they understand the value of the site’s virtuous circle. There’s an implicit quid pro quo.
Both Yelp and Angie’s List have powerful models. Loladex aims to tap many of the same motivations; we’d be silly not to. But mainly we’re about recommendations from your friends. We’re trying to bring this everyday personal interaction into your online world.
OK, so much for the theory. How’s the “help a friend” strategy working for us, specifically on Facebook?
To be honest, it’s a learning experience.
More in Part 2.