The Entrecard community has steadily grown over the past 6 months and there are hundreds of near-addicts who find themselves spending too much time every day dropping cards, blogging, reading others' blogs, and posting in the forums. As is true of many new businesses (and marriages), there comes a time when the honeymoon is over and the real work of making the venture successful sets in. Recent events, both internal and external, suggest that Entrecard's honeymoon is over and that it's time to decide whether or not this thing's going to work.
Here's a list of 10 challenges that Entrecard has to deal with that could make or break it:
1) Alexa - Ouch! Many Entrecarders (and other bloggers) got spanked hard this past week when Alexa changed their ranking algorithm and there were few left in the community whose Alexa number was under 100,000. Some have suggested that it is a short-term adjustment and that in a week or two they will be able to regain their favored status. Wishful thinking! They must be looking at their 3 month average and not their 1 week average! The real pain from Alexa's change is yet to be felt by many Entrecarders, as the not-too-distant future will see them with a much higher number than they want or are accustomed to. What is important here isn't the number, rather, what will an increasingly worsening Alexa ranking do to the psyches of Entrecarders who have justified their community participation in part to their robust Alexa position? Just how many will toss in the Entrecard towel is yet to be seen.
2) Entrecard Burnout - It's fun to try new things and to become more proficient at new processes. Based on many comments I've read on blogs and in the Entrecard Forums, there are other Entrecarders who have experienced the same burnout that I have been through. It was exciting at first to find sites to drop on and more exciting to get folks to drop a card on your site. Hours and hours and hours later the thrill has worn off and it's not likely to be very thrilling in the future. I'll bet the numbers show that over 50% of those who signed up for Entrecard are done dropping cards by their 3rd month. Oh, their widget might still be on their site, but they really aren't active Entrecarders at this point. This isn't just an Entrecard problem...it happens all the time in MLMs and other situations where expectations outrun results. What's specific to Entrecard is card-dropping and there's no getting around how tedious and boring it can become if one is trying to hit the magic 300 per day mark. All of this means that unless Entrecard develops additional methods for generating credits that reduces the need/desire to drop til ya drop, Entrecarders will continue to burn out, leaving a passel of dead accounts that clutter up the community.
3) Too Successful Too Soon - It happens in the MLM industry all the time. A new company gets overwhelmed by their own success and are unable to keep up with all the new sign-ups, which success ultimately kills the company. With Entrecard it's not just a question of needing a new server, as the real problem is the lack of customer support. We're talking about a founder and a programmer, the latter of whom has 10 other clients, with a few forum moderators thrown in. There just isn't the personnel to handle all the Entrecarders currently in the community and if growth rates continue to hold, Entrecard might sink under its own weight.
4) Graham - I suspect that Graham has no idea how much time and effort Entrecarders are putting into his venture. He had a good idea...but folks, he's still just a kid and there's nothing on his resume to suggest that he has any experience with running this type of organization. Ignorance was bliss...and my confidence in Graham's ability to run this community was shaken by his recent video blogs. I've got a 25 year old son who is a programmer and another son who is 21, and while they are very talented, they still don't know just how much they don't know. Graham's a nice kid and he came up with a good idea. Does he have what it takes to turn his idea into a thriving, long-term successful venture? I get the impression he's on a lark, having a great time basking in the spotlight, clueless to the impact his decisions have on the community, ignorant of the effort that folks have expended as Entrecarders. Does he have what it takes to step up to the next level and run a company? Time will tell.
5) Big Brother is Watching - I understand the need for a security system. I understand the need for selectively withholding information that could compromise the security system. I don't understand why changes are made to the pricing system and other Entrecard components without proper notification or community consultation. Push a button and send a message to every Entrecarder about outages, policy changes, new features, etc. Posting in the Entrecard blog or forums doesn't cut it because only a small fraction of Entrecarders go there on a daily basis. Entrecard could survey community members about possible changes and get better input than from by just asking the forum regulars. What it feels like to me is that Phirate and Graham aren't really all that interested in what we have to say, as if they feel they know best. Cool...I can appreciate that confidence. But what if they don't know what is best? There are many, many Entrecarders with significantly more experience in business and life than Phirate and Graham have and could be a resource to Entrecard if their input was more highly valued. Idea guys and programmers have their value, but they don't always see the full picture or impact of their decisions. The dust has settled on the new ad pricing system and while it is an improvement over the old system, it still has significant flaws, not the least of which is there are so few pricing options between 256 and 1024 ECs. Again, the bigger problem I see is a Big Brother Knows Best attitude that I believe has to change.
6) The Worth of An EC - There was a thriving market for ECs until the Credit Exchange was announced. Some will say that it was the "spammers" who drove the price of ECs down, which I think is pure nonsense. Sure, if there were 250,000 ECs up for sale at any given time the supply would be greater than the demand and the price would drop. No, what I believe happened is that folks sat back and decided to wait for Entrecard's exchange to kick in and it was the demand that dropped and caused the lower prices, not an increased supply. It doesn't help that Entrecard has been touting itself as a community where a blogger can make money via the sale of their ECs, should they so desire. Delays related to paypal have extended the credit exchange's launch, and the current low price of ECs, coupled with limits on max drops per IP address and changes to the security system that slowed down dropping speeds, have created a situation where most folks would be hard pressed to earn $2 a day from their card dropping efforts. Sure, $60 a month from your blog is still $60 a month...but the opportunity cost of what you could have done with that 1-2 hours a day looms large. For a while it was possible to drop 300 cards in 20 minutes and if one had 3 accounts they could reasonably generate 1000+ ECs for an hour's effort. Turn around and sell them for $10 and one could almost justify spending the time building their blog traffic via Entrecard. Now, hustle and drop 400 cards in an hour, get a 50% return drop rate, sell the 600 ECs for $5/1000 and end up with $3. Whoopee! Creating a cash value for Entrecard Credits is a great idea and once the credit exchange is operational, I believe it will be a good thing and we'll see many folks sign up as Entrecarders as a result. The risk is that the market drives ECs down to $2/1000 and the EC as currency loses its appeal.
7) Lack of (Funds for) Marketing - I'll bet that Graham hasn't spent much money on advertising or marketing up to this point. I understand why, yet at what point does Entrecard spend money to increase its public profile? The Entrecard community feeds upon itself and the lack of any incentive to reach out to those outside the community (i.e. - referral program) means that folks stumble upon Entrecarders rather than seek them out. Entrecard has an opportunity to tout its collective expertise as an asset to the public at large, which could result in many new readers to Entrecarders' blogs. However, such touting costs money, which seems to be in short supply.
8) Creature Comforts - I started a blog called Entrecard FAQs because there really was a lack of good info available for new Entrecarders. Even now, the new Entrecarder is thrown into the community without much aid or direction. I've read Phirate's reasoning for the type of forum that is used by Entrecard, and while I acknowledge the good reasons for it, I can also see that most people come into a community expecting to find answers more quickly and easily. Unless it has changed, I don't believe that Entrecard sends out much in the way of a welcome letter or anything that would help the new Entrecarder figure out what's what. Even the TOS is buried and is presumed to be agreed to, without the cursory "Check that you have read the agreement" verbiage. Yeah, I know, Phirate's been busy with higher priorities...which is a poor excuse for saying that Graham is underfunded or there'd be more cooks in the kitchen. Not everyone enjoys camping out and roughing it and Entrecard would be better served by offering more creature comforts to its members. Instead of creating its own item number, I'll throw in access to better data under this item. Entrecard has all sorts of data that we could use to make our dropping decisions (e.g.-number of times we have dropped on someone in past 30 days, ability to sort by number of times someone has dropped on us). Come on guys, give it up and make our lives easier!
9) Too Many Entrecarders? - Is it possible that Entrecard has already become grown too large? Is being a global community too ambitious? Would smaller Entrecard communities that were topic or location based be more rewarding for community members? I joined Entrecard in late December and could tell that there was a core group of Entrecarders who knew each other and visited each other's sites on a regular basis. Due to burnout, life changes, discouragement, or burnout, many of those early Entrecarders are no longer active. I think part of it is related to the size of the pond and whether or not you know the rest of the fish. Imagine 50,000 Entrecarders and the task of trying to get to know more than a few of them. Yes, it can be done, but will the sense of community cease to exist when you no longer know 99% of the populace?
10) Revenue - I've saved what I think is the biggest issue for last. Gee, this is fun, but just how is Graham going to pay for his new digs in California? Project less-than-Wonderful adds a few hundred a month, and the Credit Exchange might bring in some cash should it ever get off the ground. We've heard rumors about other ads that could bring some dollars into Entrecard, but is there really a plan? Not that I'm concerned with whether or not Phirate has pizza money, but no one wants to spend time swabbing the decks on a sinking ship. There is either a plan that includes having sufficient revenue to run this place or there isn't. One thought I had was to have a premium VIP Entrecard club. Monthly fee sort of thing, which I would usually turn down flat, except in this case I might be able to pay my dues with ECs, which Entrecard could then sell. (Or conversely, I could sell the ECs myself to pay my monthly dues.) Sign up 1000 Entrecarders at $30 a month and then Phirate could buy some beer to go with his pizza and Graham could afford to fly across the country.
I like the Entrecard community, even though I'm trying to sell The Entrecarder and move on. It's been fun and I've been able to test out some ideas, but most of all I've realized that I don't want to be a regular blogger. Yes, I have proven to myself that I can do it, I just don't want to anymore. Both by the nature of this blog and the time that I have invested in the Entrecard community, I want to do what I can to help Entrecard succeed. My intent today was not to trash Graham or Entrecard, but to highlight what I perceive as challenges that must be overcome if Entrecard is going to thrive and be profitable.
