What Happened: Print media like The New York Times and the Financial Times have struggled with business models that depend upon revenue from both advertising and subscribers paying for content. Anders Ibsen thinks he has found an alternative.
London-based Sharewall is a startup that gives access to a site’s content based on the number of people with whom each user shares content. Ibsen asked himself which kind of currencies users are willing to spend for access to content, according to TechCrunch. When it’s must-have content, then cold hard cash is acceptable, but when it’s just nice-to-have information then readers are more reticent to shell out money. They may however be comfortable with sharing that content with friends and family for the privilege of receiving it in the first place.
The bigger the circle of friends a user has the less they are asked to share as the presumption is people with long lists of friends will always generate more traffic with each share than those without. Average users will need to share one in every 15 to 20 stories to meet their requirement.
The plus for publications: more viral content and significantly more traffic; Ibsen told TechCrunch traffic rises on average by a third on shared stories. Finally, Ibsen is also using the Sharewall database to help publication’s use email to generate revenue through direct marketing.
What This Means for Brands: Clearly, the implications for publications, really none of which has found the secret sauce for a sustained revenue base, is tremendous. Increased traffic allows them to charge more for advertising and restores a lot of brand equity.
But this new currency may also hold interesting possibilities for brands outside of publishing. Could discounts be offered to loyal customers based on the amount they are willing to share information on new products or spread the word about a sale? It could become part of a new loyalty program that may mean more revenue for brands without charging people money for the privilege of getting 20 percent off.
Given that the new economy is supposedly going to be all about sharing, Sharewall’s approach may help make that a reality for media at the very least.
Contributing to TRENDING items are Amanda Ayotte, Ephraim Cohen, Michelle Choi, Michelle Goodwin, Lisa Helfer, Jeff Maldonado, Stephanie O’Malley, Lauren Price and Abby Ray.