There’s been much talk about what is going on with Entrecard. Many of the new changes have upset users and many are leaving the program. A few reasons why members are upset:
- VIP forum. The general chat is no longer open to new members.
- The starting price for selling your credits is $1.
- Graham’s disappearance.
- Paid ad annoyance (both the 50% being displayed and the large amount of ads to accept/deny).
- Ridiculous prices for ads.
- Market place unreliable.
- The bounce rate.
That is just a drop in the bucket. There are many, many reasons why members are fleeing.
Although changing to fiat economy would only change a few of these problems, it would help add to the overall effectiveness and value of the credit.
So how would Entrecard go about changing to a fiat economy?
- Create a set credit limit. Currently there are 40 million credits in the economy, try to get that down to around 25 million.
- Buy back as many credits as possible to get it there. Keep the price at $1 and see how that goes. Although many ECers are uncomfortable with that price, there are many others who are completely comfortable with it. $1 was the black market buying price before it was against the rules. (#3 may go here instead, depending on your philosophy)
- Set the drop limit to 100 and distribute the credits by propertion. This probably won’t happen, however. Entrecard is making too much money off advertisers and with a lower drop limit means less page views across the system. Less page views means less advertisers run through their budget quickly. Nonetheless, if this did happen, it may allow more members to be of quality and comment more. As well, less time will be given to Entrecard. At it’s current rate, dropping cards for just an hour a day is equal to one work day per week. It just isn’t worth it in most cases.
At the end of each day, distribute a number a set of credits according to the proportion of credits dropped. For example, if there are 1 million credits available and only 500 thousand drops, then each drop gets 2 credits. If only 250,000 credits are available, then each 2 drops get 1 credit in return.
- Make more stats available. I, for one, don’t wish to advertise on websites over 1000 credits in hoping to receive just 12 click throughs from fellow Entrecarders. What I would pay for, however, is 12 click throughs from other social media websites and search engines.
- Do more to encourage ad buying. One reason Entrecard has so many credits available is because of the low amount of ad buys. Since ads automatically take 75% out of the system, the more buys the less credits available. But how can EC change to a system where more ads can be bought?
One way, is multiple ad units (which they are said to be working on). The more ad space available means more ads sold. But I think we can go a bit farther.
A second way, is to allow campaigns similar to ProjectWonderful. Let us auto-buy ads which meet specific criteria. For example, let us auto-buy any ad with popularity above 300 at the ad price of 64 or less. They could even allow us to choose the category and place real stat data, ad clicks from non-members, etc.
The third way, would be to let us choose specific dates for our ads to display. Many times I have an scheduled to be published on a specific day which I think have the ability to get many comments from Ecers. Right now this is impossible. By letting us choose a specific day we could set up more convenient ad campaigns.
- Fix the market. Currently, buying or selling anything the in the market can result in one of the parties getting shafted. Secondly, after getting off the first page the sellers listing is almost pointless. What can be done? First, fix the layout. A better layout with better search functionality will go a long ways to make sellers and publishers happy. Second, fix the payout system. If the seller completes his part, make it auto-complete unless the buyer clicks otherwise. It is really bad when a seller does their part, then doesn’t get anything in return because the buyer is too lazy to click a button.
The more market sells, the more credits that are taxed.
- Reset the fiat economy every month. Yes, this isn’t technically a fiat economy since fiat never evolves, but lets be serious. A large amount of members come and go every month, and the amount of credits in the system should shadow that. When X amount of members enter the economy, then Y amount of credits should as well.
Although this might not fix everything, this would be a great start. I don’t buy for one second that the market would cost $7,000 to fix. That is ridiculous. Even for a full-time scripter that is about a 5-week full-time payment. Hell, I’ll do the work in half that time and do it for half as much.
The scripting is done by Phirate and he is part owner. Yes, time is valuable. But you get paid for your time used in the long-run. That is why you are the owner. Most restaurants aren’t profitable for 6-months after their opening, the internet is not any different. You do something and in the long run it will pay off. The amount of time and work you put into it is the question.
The bottom line is that Entrecard is fixable. I just feel that the main owner is giving up and letting it die. He doesn’t acknowledge specific questions asked towards him and the ones which are answered are half-baked. I’ve been an EC member for an extremely long-time in internet years, so I don’t wish to see it die. It’s just sad that most of the suggestions are going unheard.
Sometime, someone is going to open a real competitor. The competition right now are from low-budget sites who were mostly just tired of Entrecard. However, once someone with money decides to open shop, EC may very well go the way of mullets and the middle class.
Written: Apr 24, 2009
Aldon @ Orient Lodge
April 24, 2009 @ 1:39 pm
As a former Wall Street IT executive, I tend to think that a fiat economy is a bad idea. I believe we should have a free market.
As a compromise, supporting dutch auctions with a strong central bank presence would be a pretty good way of doing it. However, managed economies usually seem to be a bad idea.
A bigger issue is that the folks at EntreCard seem to have no understanding of community. They would do well to read Tara Hunt’s new book about social capital, The Whuffie Factor.
To your specific ideas:
A set credit limit: How would that work? Would they just stop giving credits when the limit is hit? Would they automatically cancel some of people’s credits? I don’t see any reasonable way to create a set credit limit.
Buy back as many credits as possible: That’s probably a good idea. How do you do that? If you have a set rate, you’re not going to get the best price. Either your rate is too low and no one will sell, or, it is too high and your paying too much. Let the market dictate, and if the rates are reasonable, buy. Otherwise, wait until there are reasonable rates.
Set the drop rate to 100 Mixed feelings about this. It is arbitrarily limiting the amount of traffic. 300 is also an arbitrary limit. Good statistical analysis would probably be a good idea to set the right sort of rate.
Distribute credits by proportion: This seems like a fairly reasonable idea. The question becomes, how do you determine the proper number of credits to distribute, or the right proportion? Adgitize is approaching things in a manner somewhat like this, and it seems to be working well for them. Yet they are distributing earnings, not credits.
Make more stats available: I like this idea a lot. We should be able to know what the credit supply is. How many credits are in circulation right now? How is it changing on a day to day (or even minute to minute) basis? Where are credits coming from? How many are bought? How many are click generated? Where are they going? How much is being cashed out? How much is disappearing in the advertising cut? What other ways are credits entering or leaving the economy? Linden Lab does a good job of this with their economy. This won’t fix the problems, but it may make it easier to figure out how to fix the problem.
Multiple Ad units and auto buying are both good ideas that should be done as quickly as possible.
Fix the market: This really just causes credits to move from one account to another without really having a significant effect on the economy. What is needed is better ways of getting credits out of the economy.
As I noted above, I don’t think a fiat economy is a good idea, so resetting it on a monthly basis doesn’t really help much, IMHO.
Just a few thoughts for now.
Aldon
Gary R. Hess
April 24, 2009 @ 2:09 pm
By setting a credit limit, I meant that for EC and not individual accounts. There are probably around 41 million credits in the economy currently. A weeks ago Graham gave numbers and it came out to 40 million credits in the economy and roughly 150,000 credits entering it on an average day (that is both including the credits created by drops and the credits taken out by taxes).
So I am proposing they sell roughly 16 million credits to reach 25 million, then have it capped off there for a month long. Meaning, at any time only 25 million credits are available. There is a lot of credits leaving due to taxes, so that money is the only ones which re-enter. Those and only those credits would then be distributed by proportion to the droppers.
Dropping the limit to 100 would give those who read blogs instead of fly-byers more of an incentive. Also, it wouldn’t take as much time out of people’s weeks to do their daily drops.
So for an example, say 300,000 credits were taxed today and 400,000 credits were dropped. That means each credit is worth 0.75. So everyone who dropped 100 credits gets 75. Everyone who dropped 50 will get 37, and those who dropped 10 will get 7 (always round down).
Everything in the market is taxed (isn’t it? if not, it should be). So allowing more items/services to be sold will only mean more credits are taxed and available for distribution.
John | English Wilderness
April 27, 2009 @ 3:46 pm
3) How about making drops unlimited, but only issuing credits for the first 100? I assume most droppers are doing so to leave their card rather than gain a credit. This would reduce the number of credits entering the system without having much impact on the number of impressions.
Gary R. Hess
April 27, 2009 @ 4:29 pm
That is definitely something EC would consider, but I still dislike it. Would you visit over 100 blogs if you weren’t getting something in return? Let me rephrase that, would you visit over 100 blogs which are on Entrecard if you weren’t getting something in return? I imagine that many people drop their cards in hopes of gaining traffic and not necessarily credits-like you assume. That is a flawed strategy right away, IMO. Traffic exchanges are very, very highly looked down upon by advertisers.
I think, they should completely redo their strategy. Get away from the ‘internet business card’ and start advertising EC as a way to find quality blogs, advertise, and get paid. Otherwise they will be stuck and will eventually be called out for what it is by major advertising companies.