Welcome to Marketplace! Another January Memo

Welcome to Marketplace! Another January Memo

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Maxwell Ryan
Jan 22, 2017
(Image credit: Maxwell Ryan)

January has begun at a fast pace, and it is remarkable to watch every department working at such a high level so early in the year. Into the middle of this I want to formally introduce our newest and most unexpected department: Marketplace. This is an extremely unique new addition to our offering, and because it's so different, it deserves an explanation.

While all of you have probably heard about our pending acquisition of our marketplace partner, Krrb, I thought it would be helpful today to give you all a bit of background, as Vee Londono, who heads up this department, will be giving everyone an overview today of the roadmap of its launch on March 1. She and her two colleagues, Lauren Hannel and Mateo Londono, have already joined us in our offices, and they will be matched with four to five new Product team members who will work exclusively on this new feature.

But first a bit of background.

I've always had a sweet spot for the reader-direct, used furniture marketplace, originally pioneered by Craigslist. In the early days we'd blog Craigslist everyday, "scavenging" for prime finds and we'd even post things we'd seen on the streets of NYC (we always thanked Craig personally in the post, and I actually emailed with him over a number of issues back then. He is cool). Back then hyper local blogging was cool and practical. It was all a part of connecting our readers to resources that would help them make their homes awesome, and with used furniture it was not only more affordable, it was tremendously green, as it created longer lifespans for furnishings that might have gone right to landfill.

Because Craigslist was hard to navigate and full of clutter we introduced our own very simple furnishings classifieds, and it lived from about 2005-2010. Our own offering was very rudimentary and while it served its purpose, it didn't grow very big, and it lacked a lot of the features that could have made it easier to transact and prosper. It was a yeoman's effort.

I met George Eid sometime in 2010-11. He was already running a successful digital agency called Area 17, and was launching a separate project - a brand new take on classifieds called Krrb.com. Krrb had an elegant, user-friendly interface and George had a new model for how to promote it, which was to partner with a large handful of sites, white labeling the interface (so that it looked like the site you were on) and growing a bigger and bigger pool of buyers and sellers on the collective backend. For the last five years we've been involved in this partnership with a number of other sites, including Chicago Magazine's website. Our job during these years was to promote our Marketplace (we changed the name from Classifieds to give it a more aspirational ring) on Apartment Therapy in return for a rev share, which only was generated from listing and promotion fees on the site (there was no money handling or transactional fees).

Our own promotion during this time was woeful. We lacked the resources to focus on the promotion, Marketplace posts were not pageview generators so our team shied away from them, and there was some concern that posting used furniture on our site brought down the overall brand value on the front page. However, regardless of our weak efforts, our readers became the biggest players within the collective Krrb marketplace, they all thought that they were being watched and cared for by us (they were actually being watched and cared for by Vee, Lauren and Mateo, who worked out of the Area 17 offices in Williamsburg), and whenever we DID promote Marketplace, activity popped.

Cut to this past October, when George came to me and asked if I wanted to take over Krrb as he was looking to give it a good home or shut it down. His reasons for this were twofold: his core business, Area 17, was growing and demanding his full attention, and after five years, Krrb still hadn't generated enough momentum to be profitable.

At this point, I decided that we would never have a better chance to realize this part of our offering, and I wanted to go for it. AT Media would do this or no one would. Over the past few years a number of "marketplaces" have sprung up, but all of them lacked the audience that we have in the verticals that we have. The biggest challenge facing any nascent marketplace is not attracting sellers, it's attracting enough buyers to allow the sellers to sell and make the marketplace hum. Imagine any marketplace you've ever been to, from your local grocery store, flea market or farmer's market, in every instance you will see many more people walking the aisles looking to buy something than stalls wanting to sell. That's marketplace math. You need many more people walking by than qualified sellers, and MOST of the upstarts in the marketplace business don't have the sellers and are working desperately to find, recruit or buy them. We have millions. Which is not to say it's easy, but we do, at least, have a built-in advantage which made me think that we had a darn good shot at being successful in this arena. AND it's totally on mission, so people would expect it.

Over the past two months we've negotiated a very complicated hand off process by which AT Media will take over the Krrb.com business, migrate its staff and relaunch it as one large unified marketplace, Apartment Therapy Marketplace. We are in the final stages this week and should be complete and moving forward by Friday.

In combining Krrb with AT, we will be creating synergies wherever possible and not keeping Marketplace separate as it was in the past.

Krrb.com has relied heavily over the years on its own marketing, and its activities on this behalf include an editorial content blog, email and social media outreach. As we roll this into Apartment Therapy it gives us an opportunity to take all of the Krrb marketing properties and rename them as extensions of our existing "Shopping" vertical, providing a dedicated location to distribute all of our great shopping content, Marketplace finds and affiliate posts.

We are hiring new Product team members to take the handoff from Area 17, which will include an IOS developer to transform the Krrb app into an AT app. These developers will add to the capability of the overall Product department and will flow back and forth across the department, bringing with them as they move insights into how we can integrate Marketplace more deeply into the AT experience. Additionally, building an app for both sites has long been discussed and taking over the Krrb app gives us a quick start towards this for both sites. We will now have an IOS app developer on staff.

Additionally, one of George's long desired ambitions was to make Krrb fully transactional with purchases flowing through the system. This we call the introduction of the "Buy Now" button. This button would open a path that would allow for guaranteed and secure payment, the ability to reserve an item before pickup, and the ability to make the whole Marketplace free for listings in favor of a 10% transaction fee when any deal is complete.

The Buy Now button finally launches within the next few weeks.

In the month of February you'll be seeing a lot of activity around the folding in of Krrb to AT as well as preparations for a launch campaign that will extend through the month of March. The goal is to create a single market destination with all of our outreach pointing at it so that we can flood it with potential buyers and sellers to see its peak potential. Over the next six to nine months the Marketplace team will then iterate with build-measure-learn loops to make the experience more seamless and transactions more successful.

This is a big new experiment for our company that falls squarely into line with our Year of the Reader OKR and will test our ability to improve in a very Lean Startup way. It will nicely jump us into a high level community feature that will provide real utility to our audience and give us a lot of information back about them. Once we get the recipe right, we'll then look to extend Marketplace to Kitchn, so that it takes in the full reach of our collective audience.

As we move into the future of our medium, we must stay within our mission while taking fuller advantage of the web's ability to offer more service and interaction to our readers. While they come to be inspired to change their bedroom or learn how best to cook a pork chop, I am excited by the prospect a year from now of them also finding one another to purchase a beautiful bed or a seasoned cast iron pan before they leave our sites.

Best, Maxwell

January 30, 2017

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