CEO: Reduce the entry threshold egg effect

In the Chinese world, when we ask if there is a chicken or an egg, it is often not a natural science discussion, it is a puzzle of brain teasers.

Interestingly, in the English world, when it comes to the use of it's a "chicken-egg" problem, it is often a social science issue-when you want to do any service, you need to have buyers and sellers to join your platform before you can start having a deal happen when typical Chicken-egg Problem appeared.

The best example is the electric car, we all know that petrol more and more expensive, open electric cars more money, but also more environmentally friendly, but at present it is difficult to find a power station outside, charging is very inconvenient, so no one wants to buy electric cars, no one to buy electric cars, there is no one want to No chickens, no eggs, no eggs, no chickens, and finally all of them stuck together in the prisoner's dilemma.

This is the most easily overlooked problem for entrepreneurs who want to do the platform, they often fantasize that when the platform is built, the buyer and seller will automatically come up with the transaction, and they can legs the money.

The problem is that since there is a network, I do not know how many people have tried to cover these friends, auctions, second-hand cars, video games exchange, language teaching platform, but the real success of the few hope. If you look at the reasons why they failed, of course not because the platform is not well built, but throughout, they have not broken the chicken and egg problem.

So to cover this type of bridge service, you not only want to build the platform, but also want the first batch of chickens and the first batch of eggs, exactly where to come from.

Down compatibility

The most typical solution is backwards compatibility, which allows your new platform to support existing mainstream platforms.

For example, when the IPad comes out, Apple lets all IPhone apps run on it. When the iPhone comes out, make all the IPod songs available to listen to. When the ipod comes out, all the CD songs can be turned into MP3 format and automatically synchronized to the ipod via ITunes.

The downward compatibility allows you to bring the chicken with the mainstream platform directly to use, then the eggs on your platform will become much easier. So to solve the problems of the electric car above, you need is plug-in Hybrid, that is, can be recharged and refueling of the oil-electric symbiosis car. This car is compatible downward, when there is a power station, it can be directly plugged in, without adding a power station, it can still go to the General gas station refueling, which makes the buyers want to buy electric cars will not because of the lack of power stations in the market and give up buying. And wait until Plug-in Hybrid many, add power station Natural also will follow vigorous, and egg problem also be solved.

Lower entry threshold

The downward compatibility is in fact somewhat lowering the user's entry threshold, thus lifting their willingness to use. So in addition to supporting the mainstream platform, many other methods of lowering the threshold can also be used as appropriate.

For example, when the yuppie state wants to move anonymous bloggers to their platforms, they also offer free relocation services that allow you to jump from one place to another with no pain, apart from supporting the existing blog specs (HTML, RSS ...). The B Manpower Bank, which seeks to attract job seekers from the a human capital bank, will also provide a resume service in addition to supporting the biographical form of the A human bank, so that users can quickly start anew.

In addition, many platforms will provide a free trial, the first purchase discount, and even like the anonymous station of limited Platinum members, are in the early adopters to the threshold of entry pressure to the minimum, so that the platform to break through the egg dilemma.

Who's the key?

In the early stage of the platform to lower the threshold of entry, especially to provide downward compatibility, we must first find out whether the chicken to the downward compatibility, or the egg to the downward compatibility, or, the existence of chicken and eggs, which is more critical.

If it is a platform for the buyer and the seller, usually the seller is more important-in the transaction the buyer often provides the money, while the seller provides value, so when the seller is willing to go to the platform, it is tantamount to the value of the platform.

For example, the Eztable platform for consumers to order restaurants in the initial stage of start-up, before the platform has not been built, four founders had long split up, each talked about dozens of restaurants to join their services. No internet in the restaurant? No problem, eztable down compatibility, whether you want to use fax, cell phone or phone, they can connect with you.

For example, to help people find decoration to repair Master's 5945 platform, their first step is to ride a motorcycle to sweep the streets and visit the Taipei City, first to find the water and electricity in the houses and to become their first source of master--------------many of them are not online, so 5945 down compatibility, phone, cell phone, newsletter, all

For example, the first step in setting up a general venture is to raise a fund first and then try to invest it. But three years ago when we started the Appworks, we used a new perspective to look at this matter, to see the venture as a media investor and a platform for start-ups. Entrepreneurs are certainly sellers, so try to attract them first. So Appworks first to provide the plan, and so on to determine the service can help entrepreneurs provide value, attract a good startups to join, then we go to the investors to raise a 320 million fund to invest in them.

Google, for example, is a platform for advertisers and consumers, and the buyer is The advertiser, so they have to do the search engine well and attract enough consumers before they can have advertisers willing to buy it. And in search of this, the party selling (the supply result) is all the websites, and the buyer is the consumer, so before there are consumers, Google must first make a website that has the best web crawler in the world (down compatible) and the best search results in the world.

Killer apps

In addition to lowering the entry threshold, the promotion of entry value is also an important key to attracting chickens and eggs, the so-called killer App.

Facebook, for example, does not rely on social networking to enter Taiwan, but on the killer app, the happy farm. Line relies on the invincible cute stickers, WeChat by the push to Talk,iphone rely on the Internet, sync with iTunes music, Android is with Gmail, Maps and other Google services in depth integration, and Twitter It is simple enough to kill the user and attract the first batch of chickens that will lay eggs.

You will find that most of the early killer apps are provided by the platform owner, because in an early platform without the Internet effect, the buyer and seller have no reason to preempt others, so only when you can provide a powerful killer App will you be able to attract the first users, There is also the opportunity to create a powerful network effect in the end.

The conclusion is that if you are going to cover something that is a platform, then the egg strategy is the Go-to-market strategy you must have.

The above is today's CEO, hope to help you think, early breakthrough product early prisoner dilemma.

User comments:

Earthly: Good argument, in my experience, the new E-commerce platform for the business, should have the first sellers. On the surface is the seller to provide the Revenue (Commission), but essentially for the buyer to provide services: with products, only services (shopping guide); the better the service, the more buyers; the larger the flow, the more interested the sellers are. How to attract sellers is the key, our approach is to provide them with offline marketing and supply chain management services, online for sellers first is the work platform.

Xiao Bao: This point of view has practical significance, especially for the low capital of grassroots entrepreneurs, is an economic and efficient venture into the angle; the so-called high capital of the high handsome entrepreneurs, but also to avoid in the big misunderstanding to improve the chances of success of entrepreneurial strategy: backward-compatible.