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Bribery as a business model?

20 November 2012

So you think you've got a winning business idea. You spend a lot of time and money turning that idea into a website and service. You launch the service -- and virtually nobody comes.

What do you do next?

Simple -- you bribe them with offers of a million dollar prize if they subscribe to your service.

Isn't this a good idea?

Yeah, right!

Someone needs to go to marketing school and look at the studies that have investigated the many times this type of bribery has been attempted as a "grasping at straws" method of turning a sow's ear into a silk purse.

Neither I, nor many of my readers (if the forums feedback was to be used as an indicator) held out much hope for ListSellTrade as a legitimate contender for the crown of "successful auction site" -- and it would appear we were all pretty much dead right.

Browsing the LST listings is a real disappointment with categories that should be flooded with hundreds or thousands of listings, serving up a paltry single or two-digit total.

So where did LST go wrong?

Simple -- they tried to reinvent the wheel without adding any significant extra value for the vast majority of auction-site users.

Now they have found that the world is not beating a path to their door, nor are they keen to hand over $10 a month to list in a deserted marketplace -- especially when TradeMe allows casual sellers to list for free just pay a success fee if/when they sell.

The new $1m give-away is a pretty safe "do or die" bet for LST.

If they get the half-million long-term active subscribers needed for the prize giveaway to activate, they'll have banked more than $15m in subscriptions -- so giving $1m away is a minor cost.

However, to quote from that iconic Australian movie The Castle -- "they're dreaming".

If you want to win a million dollars you can buy a lotto lucky-dip for a tiny fraction of the $30 you'd have to ante-up to be eligible for the LST prize, and with lotto you're guaranteed that there will be a prize-draw. There's no such guarantee with LST's offer.

What a tragic disaster LST has turned out to be and this latest act of desperation shows just how out of touch they are with the market and how little they actually know about marketing in "the real world".

Why on earth anyone would recruit the parent company to develop their web marketing presence I have no idea, and I suspect this fiasco has done a huge amount of damage to them -- especially after the first few attempts to launch the site crashed and burned.

The holy grail of "NZ's most popular auction site" remains firmly stuck on TM's head and until we find contenders that are prepared to think outside the box and come up with some real "killer benefits" for the average seller then that's where it will stay.

To be honest, I'm really surprised that nobody has come knocking on my door -- I have offered to spill my guts in respect to what *I* think would be a model that would give TM a run for its money.

Should we run a sweepstake to see when LST folds?

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