The "ladies' night" strategy

http://cdixon.org/2010/10/16/the-ladies-night-strategy/

by jonathanjaeger • 16 years ago

101 19 16 years ago

The classic problem of having a two-sided market with an interesting real-life analogy of bar-hopping/clubbing. Interesting to see whether Red Beacon or Thumbtack address this issue the best (or maybe the services market is big enough for the both of them).

newyorker• 16 years ago

Great article on two-sided markets!

Do you have more great suggested resources to read?

jonathanjaeger4• 16 years ago

I suggest reading other posts by Chris Dixon if you liked this one (cdixon.org) or any of the posts by Mark Suster on BothSidesOfTheTable (here's one that is somewhat related you might enjoy: http://www.bothsidesofthetable.com/2009/10/04/3-sales-tips-f...).

minouye• 16 years ago

Another challenge is the risk of alienating one market is always present. To use the eBay example, they've recently focused their efforts much more squarely on buyers by introducing new "top-rated seller" criteria and a fairly liberal Buyer Protection Program. Buyers have benefited greatly, often at the expense of sellers. I imagine in the next couple of years, the balance will have shifted back to appease the unhappy sellers.

To contrast, Amazon seems to have done a good job of growing out its base of satisfied external sellers (no personal experience, just anectodal). Perhaps aiding this is the fact that Amazon has an intimate understanding of how to succeed as a seller (they get fulfillment, pain points in the purchasing process, etc.). They worked to cultivate their main market (the buyers), while actively operating in their future market (as a seller).

code_duck• 16 years ago

If you do this, be sure to adjust your strategy once you've attracted enough of the 'hard side', or things can become unbalance.

sokoloff• 16 years ago

Interesting post, but I'm not sure that Microsoft users/developers is a particularly good example of a two-sided market.

What percentage of Windows users chose Windows "because there are so many developers"? (I'm sure many developers develop for Windows because of the vast number of users.)

StavrosK• 16 years ago

Well, many users choose Windows because there are many developers (and thus a lot of software), but I'm not sure that, in a two-sided market, each side will choose the market because the other side has high cardinality. From what I understood, it's only one way (attract the users and the developers will come).

jdp23• 16 years ago

in the corporate world, availability of IT apps on Windows is a huge barrier to Linux and Mac penetration

also back in the 80s/90s app availability was a huge battleground for OSs, and became a big advantage for windows over OS/2 etc.

ojbyrne• 16 years ago

Digg was like this (and presumably Reddit and HN are too) - a small few contributed to the site comparable to the number of readers. So in the beginning there were many mechanisms (leaderboards, profiles, friends) for attracting contributions.

jonathanjaeger4• 16 years ago

Correct. For content sites like Wikipedia or Digg, it's a small percentage of the users creating an overwhelming majority of the content (probably more extreme than the 80/20 rule). Adding social features and gaming mechanics is one way to incentivize those that are going to be putting in the work.

IgorPartola2• 16 years ago

I wonder what the actual split is. What is the number of front page stories contributed by the top X users on HN?

snotrockets• 16 years ago

Interesting anecdote - an Israeli judge recently ruled against a club that had a "ladies' night", forcing it to charge equal price for female and male patrons, as having a different price based sex is a discrimination prohibited by law.

IgorPartola2• 16 years ago

This also gets into a whole debate of gender issues. For example in matters of HR, nobody is qualified to judge someone's gender. If this same logic was extended to bartenders and bouncers then "ladies' nights" would not be able to exist. Then again, in this case it seems that the state of the system is a steady state: (heterosexual) men are happy that women are at bars, women are happy to get cheap/free drinks and bar owners are happy to make money.

jadence• 16 years ago

"Ladies night" is also illegal in California (among other states) though the practice is still relatively common.

http://en.wikipedia.org/wiki/Ladies_night#California

xenophanes• 16 years ago

> If you are starting a company that targets a two-sided market you need to figure out which side is the hard side and then focus your efforts on marketing to that side.

But if you get a bunch of the easy side, that will attract the hard side. You can do it either way.

Look at buyers and sellers. If you have tons of buyers, that will attract sellers. And if you have tons of sellers but no buyers, that will attract buyers.

cdixon• 16 years ago

I think a lot of times the "hard" part is a prerequisite for the easy part. Think of UGC sites - the hard part are contributors. Without contributors you can't even begin to go after readers.

The "ladies' night" strategy

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