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Threadless.comCreating profit through an online design community
Team CLalit Chopra, Eliran Drucker, Geoff Gibson, Benni Lickfett, Josh Mischel, Verity Noble, Daniel Santamaria, Alessio Tixi
Introduction
Hi Jeffrey – Video from 2007
What does threadless do?
Threadless.com
Designs 150,000+ / year
Sales$30MM+ / yr
Community(“Crowd”)
Designers100,000+
Buyers4MM+
Source: dailycrowdsource.com
~10 shirts / wk
Vote for faves
Community Contribution Direct threadless contribution
Design community participates
for recognition
Analysis
Inte
rnal
Exte
rnal
S W
O T
Strengths• Crowd sourcing
• Immediate feedback• Cheap price of content acquisition• Only print buzzworthy merch, Reprints
• Social network - Meetups (376 int'l & domestic communities)• Speed for new mediums ex. Twitter
Weaknesses• Shipping costs • Fickle nature of crowds• Lack of content control• Cost of blank tees/raw materials
Opportunities• Product Variety • Customer Segmentation• Concentrate on International Market
• Japan, South America as potential growth targets
• Retail Store Expansion
Threats• Intellectual property rights (China)• Launch of similar business model• Alienating the crowd
• Become too mainstream, lose their soul • Attrition from main contributors
• Limited expansion opportunities
Pillars of Crowdsourcing
• Score• Submit designs
• Share (pics, media)• Purchase tees• Recommend
• Comment• Interact with
threadless team
Participation
Accessibility
Community Building
Blog & Forums Apps Street
TeamThread-spotting
Meetups(online to
offline)
Attracting & Retaining Power Users
New Incentives (scholarships, grand prizes)
Recognition
User feedback
Challenges
Meetup groups
Limitations & Risks of crowdsourcingKey Issue Mitigation
SIZECritical mass needed but not always appreciated by core users
KEEP ENGAGEMENT HIGH• Invest in community & culture• Offer meaningful Incentives• Support and engage power users
QUALITYYou are presenting the user, need to meet expectations
QUALITY MANAGEMENT•Strictly monitor satisfaction and culture•Only promise things you can deliver•Focus on constant feedback
LEGITIMACYWhy are we the right community to present the user
DIFFERENTIATE PRODUCTS•Launch sub-brands.•Define limits and purpose•Stay focused
CENSORSHIPManage the community without taking power from the people
BE TRANSPARENT•Communicate your rules•Use communal editing when possible
8 Factors for Success
Right Purpose: Call to the crowd for insight you will act on
Right Call: Tell the crowd what you want from them
Right Crowd: Crowd needs to be diverse and qualified
Right Incentives: Glory, ego, altruism, greed – feed the crowd’s needs
Right Model: Define the output needed from the crowd
Right promotion: Get people in and get them spreading the word
Right Community Management: Nurture crowd participation and know
when to chime in
Right Technology: Features vary, beware one size fits all
Successful Crowdsourcing
Amazon's Mechanical Turk• An on-demand, global scalable workforce• Mix of crowdsourcing and marketplace• Workers perfom “Human Intelligence Tasks”
Netflix Prize• Recommendation engine• Targeted developer community• Innovation prize: $1 million for
best algorithm
Common Mistakes
• Overlooking daily moderation• Choosing the wrong first crowdsourcing topic• Assuming crowd recruitment is easy• Not identifying/involving power users• Not investing enough in the right incentives
Unsuccessful Example
Pepsi refresh project:• Donates money to non profits• Consumers vote for non profits
Problems:• Cheating in grant process• False information
Moderation Mistakes:• Not enough experience in managing community• Did not attract the right community members• 3rd party assesses validity of leader board
What should be next for threadless?•Keep focusing and expanding design focused
products and add design services
•Atrium, Platform for charity design campaigns
•Develop social editing platforms
What should not be next for threadless?• Opening a 1700 sq ft store…. Too late
• Going Big Box, compromising community
•Produce non-design products
•Going beyond production capabilities
“There was no good reason for us to open a store” – Jake Nickell
ConclusionsIt’s an amazing tool…. but not for everyone
• Identify a relevant community• Listen to the people, understand their motives • Identify right crowd-sourcing model• Realize limitations and need for management
It won’t go away…
• Empowered users won’t want to switch back• Expect to see more and more in government,
science, funding, forecasting …and crime• Companies will need to shift from reactive to pro-
active mind-set
Questions?