Results

Online social networking and blogging sites seem to be the latest incarnation of “word of mouth” advertising. And, not surprisingly, this type of marketing strategy seems to be working well for some small businesses. Recently, the Wall Street Journal published an article about Etsy.com, an internet marketplace that caters to buyers and sellers of handmade goods. The site provides for a lot of user interaction through profiles, blogs, and forums, as well as rating-and-feedback system. The site boasts nearly 800,000 registered users, many of whom are artists seeking to sell their goods to others. For a minimal fee (20 cents for up to four photos of your product, and 3.5% commission on all products you sell), an average of 15,000 daily transactions take place, which has generated millions of dollars in profit for the site.

And to what does founder Rob Kalin attribute his success? Because the site has embraced so many social networking features, Etsy.com has not had to worry about marketing costs. It is all done by satisfied users online. This ranges from everything from user-generated YouTube videos to additional websites created by Etsy.com fans. One of the most noteworthy of these sites is We Love Etsy, created by Lis Kidder, a glass-jewelry designer and an Etsy.com fan. The site, which has nearly 2,800 members, allows subscribers to interact and trade tips in different ways than is possible on the official site. According to Kalin, all of this buzz being generated online about his site means “we don’t have to spend anywhere as much on marketing because there are all of these avenues for people to spread the word and talk about what we do.” From a strictly business standpoint, being able to generate this magnitude of free publicity is certainly a lucrative prospect for the website.

There is certainly a lot of activity the site’s forum pages. Users discuss everything from current hot items to shipping liabilities to other user profiles. One thread was even dedicated to the negative aspects of blogs (though this did not stop some users from posting links to their Etsy-related blogs!). It is also possible to navigate to some of the other user-generated sites (such as the aforementioned “We Love Etsy”). This extremely active web community has helped Etsy grow and improve the site.

Of course, Etsy.com is not the only website to use this kind of marketing tactic. Ebay.com, for example, has been using this kind of forum and feedback system for a while. Though they may now advertise in more traditional venues (television commercials, etc.), they were once completely reliant on the same viral marketing strategy that Etsy.com currently utilizes. Another good example of this is Facebook.com. This online community already has a very well established pool of registered users, and the site has recently begun supporting forums for the purposes of selling goods, advertising rooms for rent, etc. In addition to this, the site is now open to any and all users (whereas before it was strictly a community for college students). In both of these cases, like Etsy.com, this type of marketing plan was successful.

The marketing plan for Etsy.com basically relies on the fact that if a company can bring a group of people together who all share a common interest and give them sufficient means to communicate and interact with one another, then the results will be mutually beneficial. It certainly has proven true in several cases, and other web businesses are now scrambling to use social networking as a marketing opportunity.

Tuesday, March 25th, 2008 You can skip to the end and leave a response. Pinging is currently not allowed.

By Michael Gorvin