e rated sidelineswap case study
TRANSCRIPT
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Case Study Content
Case Study Content 2 Project Summary 3 Challenges 3 Solution 3 Enhancing User Profiles: Taking Trust to New Heights 4 Accelerating Seller Growth 5 Increasing Sales and Marketplace Revenue 7 Summary and Conclusion 9
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Project Summary SidelineSwap is a marketplace for sporting goods based in New York City, which launched in 2013. The marketplace offers a user-friendly platform that specializes in allowing everyday athletes and fans to buy, sell and trade their equipment, apparel and footwear. The platform allows users to create profile pages called “lockers”, where users display the items they are seeking to sell or trade. Since its launch, SidelineSwap now has 22,000 users and more than 4400 fans on Facebook. The purpose of this case study is to offer a summary of eRated’s partnership with SidelineSwap and to describe challenges and solutions during the life of the partnership thus far. The case study is drawn from a pilot phase with 117 eRated users in the marketplace.
“We needed a boost for sellers, especially our new ones. We wanted a hassle-free solution that fit seamlessly into our workflow,”
Brendan, Co-Founder and CEO.
Challenges The founder of SidelineSwap, Brendan, communicated to eRated three key challenges: Enhancing user profiles, accelerating seller growth and increasing sales and marketplace revenue. Enhancing user profiles through bolstering their reputation is critical for building trust in a marketplace. Brendan wanted an easy solution to allow his users to import more information about themselves. The more buyers know about a seller, the more likely they are to buy. SidelineSwap wanted to accelerate seller growth through making inactive users active and scaling up existing users already selling in SidelineSwap. Brendan hoped eRated could help make good sellers great and help inactive sellers get in the game. Brendan wanted to increase sales and marketplace revenue. His marketplace generates revenue based on the amount of transactions on his platform. There are no ads and no subscriptions, which means the only way for Brendan to increase revenue is through sellers selling more. He partnered with eRated to help increase revenue for SidelineSwap.
“I just couldn’t get off the ground in the beginning. I was posting quality gear, but no one was buying,” Phil Hess, SidelineSwap User.
Solution eRated integrated with SidelineSwap and went live in the marketplace in June, 2014. Brendan adopted eRated’s widget to supplement his existing reputation system for displaying user reputation and reviews. It’s through the widget that ratings and reviews from SidelineSwap, as well as from other marketplaces, are displayed and how users opted in to eRated.
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SidelineSwap had its own, unique look and feel. Brendan wanted to make sure the eRated widget conformed with his existing interface. After a quick overview of the many customizable features of the
product, Brendan adopted the colors and layout he wanted. Additionally, he was able to choose which social media platforms and which other marketplaces his users could connect to. With the advice and support of eRated staff, all aesthetic decisions with respect to the widget were left up to Brendan. A trial period was imposed at the outset to ensure there were no bugs and advertising of the new product was delayed for one month. Users were first exposed to the widget in July. eRated began collecting data on user activity at this time. As a new marketplace with limited resources, minimizing the amount of time necessary for adoption was essential and Brendan reports the integration process went smoothly as developers from both teams worked together to quickly integrate
the product. eRated staff were available for troubleshooting at all times and the whole process took three quick hour-long sessions.
Enhancing User Profiles: Taking Trust to New Heights Sellers, buyers and traders share a passion for sport and Brendan wanted eRated to give his marketplace a stronger feeling of community. Since integration, 80% of eRated users have connected their Facebook account, 16% have done the same for LinkedIn and 10% have connected their Twitter profile. In addition, users can also add their profession and location to their widget. Connecting social media accounts and adding other personal information enhances a user’s profile and generates a heightened sense of trust and security between the buyer and seller. In online marketplaces, trust increases sales.
Figure 1: eRated widget in Sidelineswap product listing
Figure 2: eRated widget of seller who connected his eBay account
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Figure 3: Social Accounts distribution of eRated sellers
Like many online marketplace founders, Brendan knew early on that his merchants were operating in other platforms, like eBay and Amazon, as sellers and buyers. Rather than overlooking this reality, he looked to eRated to help his merchants capitalize on their existing reputations in other marketplaces. eRated allowed merchants to import all of their existing behavioral data from other marketplaces to enhance their profiles. Overall, 58% of eRated users imported their reviews from at least one external marketplace, with the most common being eBay. The widget always gives precedence to reviews and ratings from SidelineSwap users, but the addition of data from other marketplaces has added considerable depth to user profiles. Through eRated, his users have imported 7038 reviews from other marketplaces into SidelineSwap. That’s an average of 60 reviews per person. 70% of online buyers simply won’t buy from users with zero reputation because they don’t trust them. By importing over 60 reviews from external platforms, eRated has helped SidelineSwap users significantly enhance their existing profiles and increase trust with the buyers.
Accelerating Seller Growth There are two types of marketplace users: Inactive users who have not yet made a single transaction and active merchants who have. For Brendan, almost nothing is more important than getting inactive merchants selling and helping active merchants scale up sales. This is because accelerating seller growth means increasing sales, and increased sales translates into marketplace revenue. eRated has helped SidelineSwap in both respects.
Helping Inactive Users Get in the Game In every online marketplace, even the larger ones like eBay, 20-40% of user profiles are dormant. Meaning, they make no transactions. New sellers in particular are at significant risk of remaining inactive because it’s so hard to make those first few sales without a reputation. Many simply get discouraged and disengage. This represents a considerable loss of revenue for founders like Brendan.
80%
16% 10%
Facebook Linkedin Twitter
Social Accounts Connected
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User Name Time before joining eRated
(days)
Time after joining eRated
(days)
Transactions per month – before
Transactions per month -‐ after
Revenue per month -‐ before
Revenue per month -‐ after
Troy Purser 110 128 0.00 2.34 0.00 110.16
Riley Peterson 318 108 0.00 1.11 0.00 97.22
Philip Hess 162 97 0.00 2.47 0.00 72.68
Bradley Charron 77 95 0.00 1.26 0.00 63.16
Scott Manzo 30 39 0.00 1.54 0.00 92.31
Jacob Lacy 247 117 0.00 0.26 0.00 15.38 Jesse Jenkins 73 72 0.00 2.50 0.00 25.00
Nick Gainer 32 15 0.00 2.00 0.00 90.00 Figure 4: Sample of inactive SidelineSwap sellers that started selling after joining eRated.
Instead of continually spamming his membership, Brendan decided to offer eRated as a free tool to help new users get selling. By bringing in social media data and their ratings and reviews from existing profiles in another marketplace, like Amazon or eBay, new users became trusted sellers. Through importing their reputations, eRated was able to make 10% of its users active for the first time - meaning they actually started selling in SidelineSwap. The average amount of time inactive users spent on SidelineSwap before adopting eRated was over four months - that’s 131 days without a sale. After an average of 88 days using eRated, activated users have imported an average of 29 reviews, becoming much more trustworthy. SidelineSwap merchants who had no previous transactions before adopting eRated have now made a total of 36 transactions in the marketplace. On average, in each month since SidelineSwap adopted eRated, inactive users have brought in $565.00. This represents a total of $1540.00 worth of transactions during the life of the partnership (3 months). On average, users who were once dormant are now making an average of 1.93 transactions per month and bringing in an average of $68.00 each month. This represents 5.23% of SidelineSwap’s total monthly sales. eRated has helped new users in SidelineSwap start earning revenue and building their reputation within the marketplace. eRated not only enhances reputation, it enhances confidence.
“I brought in 73 reviews from outside SidelinSwap through eRated and I’ve now made 10 sales and $470.00 in revenue,” Troy Purser, SidelineSwap user.
Making Good Sellers Great
Integrating with eRated has positively impacted seasoned sellers through adding ratings and reviews from other marketplaces. Before opting in, an eRated user averaged 5.6 transactions per month. After adopting eRated, these same users averaged 13.04 transactions per month. This represents an increase in monthly transactions of 182%. While existing SidelineSwap merchants may have good ratings and reviews from previous SidelineSwap transactions, importing their reputation from other marketplaces has enhanced buyer trust in them, leading to more monthly transactions.
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User Name Time before
joining (days)
Time after joining (days)
Transactions per month -‐ before
Transactions per month -‐ after
Transactions diff before & after
Revenues per month -‐ before
Revenues per month -‐ after
Revenues Difference
Ross Crowley 726 116 1.40 2.33 66% 98.14 116.64 19%
David Schwarz 416 59 1.01 3.56 253% 46.37 127.12 174%
Alec Talarico 870 44 0.34 1.36 295% 26.90 19.09 -‐29%
Marshall Hood 650 91 0.14 1.98 1329% 5.08 72.86 1335%
Nolan Maguire 511 158 0.18 0.19 8% 46.38 13.29 -‐71%
Bryan Epstein 367 142 0.25 0.21 -‐14% 2.04 8.45 314%
Elliott Shevitz 54 108 0.56 1.39 150% 16.67 47.22 183%
Scott Hale 369 143 0.08 0.84 932% 1.63 29.37 1706% Figure 5: Sample of active SidelineSwap sellers that were already selling on the platform.
Like Brendan, SidelineSwap merchants are chiefly concerned with their bottom line. eRated was a free option he presented to his users, believing that building trust in his market would increase revenue for experienced SidelineSwap sellers. After an average of 100 days of usage, eRated merchants went from average monthly revenue of $397.91 to average monthly revenue of $490.29, which is a healthy increase of 23.22%. SidelineSwap is a community that values its merchants. Seeing his loyal merchants making more money in his marketplace is a job well done for Brendan. eRated was able to provide a solution for his existing sellers that led to discernable revenue increases. “I went from having $5.08 per month in sales before eRated, to having $72.86 per month after I
joined up,” Marshall Hood, SidelineSwap user. For new and existing merchants, eRated has been able to accelerate seller growth in SidelineSwap, which means more transactions for sellers, more revenue for the marketplace and a more active community of users.
Increasing Sales and Marketplace Revenue At the end of the day, generating more revenue for sellers and for SidelineSwap is the only KPI that matters for Brendan. Sports may be a hobby for some, but for him it’s a business. eRated committed to Brendan that its product would make his marketplace and his users more money. Of the 117 SidelineSwap users who have opted into eRated since the product went live, an average of 60 reviews per user have been imported from other marketplaces and 19.66% of these have made a transaction.
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What has integration with eRated meant for sellers? Depicted above, the average number of days before adopting eRated was over 300 days, during which time these sellers made an average of 5.6 transactions per month. After adopting eRated, SidelineSwap sellers averaged 26.08 transactions per month, which is an increase of 338%. Put differently, the average transaction per month per user was 0.37 before eRated. After adopting eRated, that number has gone up to 1.53, which is an increase of 312%. Compared to non-eRated users, whose increase during the same time period was only 4%. When it comes to revenue, eRated has helped sellers make significant strides. For all eRated users on SidelineSwap, total monthly revenue increased from $398.00 per month, to $1035.00 per month. This increase of 160% is making a big difference to eRated sellers in SidelineSwap. On the other hand, non-eRated sellers have seen an increase of only 11%. There are many variables that affect sales, one of these is the number of page views each seller has on their product listings. Not only are eRated sellers getting more sales, they are converting much better than non-eRated sellers, as the graph below demonstrates.
Figure 7: Represents the difference in conversion rate between eRated sellers and non-‐eRated sellers
The conversion rate is the likelihood a buyer will click-through to view a product and make a transaction. eRated sellers are converting much better than non-eRated ones. eRated sellers had an
0.35 0.26
0.38 0.39 0.25
0.09
0.32
0.57
0.88
2.18
0.93
1.32
0.00
0.50
1.00
1.50
2.00
2.50
June July August September October November
Transactions per 1000 page views - comparison
Non-‐eRated Sellers
eRated Sellers
eRated users monthly revenues on sidelineswap
Sidelineswap monthly revenues
Figure 6: Represents SidelineSwap’s monthly revenue from September 2013 - November 2014.The dashed line represents the time at which the eRated widget went live on SidelineSwap.
eRated Live
eRated Live
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average of 1.03 transactions per 1000 page views, while non-eRated sellers had only 0.29 transactions per 1000 page views. Higher conversion rates translate into a higher ROI from each buyer on SidelineSwap. Overall:
• Activating dormant sellers: Adding 5.23% in total sales across the marketplace. • Improving active sellers: Adding 5.9% in total sales across the marketplace. • Increasing ROI on current traction by more than 3 fold.
eRated sellers represent an estimated number of 2% of SidelineSwap sellers. If all SidelineSwap sellers were eRated users each one of the three parameters above would have the potential to increase marketplace revenue by 2-3 fold. Through helping sellers and the marketplace make more money, eRated is a tide that raises all boats.
“It’s pretty simple. Users who use eRated sell more than those who don’t,” Brendan, Founder and CEO
Summary and Conclusion Since SidelineSwap partnered with eRated in Summer, 2014 marketplace sellers have benefited from having the opportunity to own their reputation. Importing more reviews, ratings and social media information has led to more trust between buyers and sellers, resulting in more transactions and higher revenues for sellers and the marketplace. To summarize the top achievements of the pilot
• Enhanced user profiles: 7038 external reviews imported into SidelineSwap with an average of 60 reviews per user.
• Accelerating seller growth: o Activated 10% of inactive sellers, increasing monthly transactions per seller from 0 to
1.93 and monthly revenue per seller from 0 to $68.00. o Increased active seller transactions by 179% and revenue by 23.22%.
• Increased sales and marketplace revenue: eRated sellers increased their sales by 160%, totaling an additional 11.13% in marketplace revenue.
eRated is committed to being an efficient and impactful solution for online sellers and marketplaces by enhancing profiles, accelerating seller growth, activating inactive users and increasing sales and revenue for the marketplace. For SidelineSwap, eRated has become an invaluable tool for going the extra mile.
“If every seller opts in to eRated, I will be a happy man” Brendan from SidelineSwap