Types of Incentives for a Web 2.0 environment

Posted by Sean Lew on Saturday, 5 September, 2009 under Blue Sky Thinking, Incentives, Web 2.0 |

I have been discussing incentives in for a Web 2.0 environment quite abit recently. Incentives comes in many forms, shapes and sizes. I would like to discuss more about the incentives that could be used in such an environment to improve adoption and usage. I will provide some high level case studies as well.

1) Solving a personal problem
Many social networking tools like Facebook and Aardvark help solve a personal problem. Users could connect with their friends online, check out their photos and status and communicate on Facebook. The functionality provided by Facebook was something that could not be done previously via emails. In Aardvark’s case, if you have a question that could not be answered, a user can ask aardvark and they will search for someone who they think could know the answer and help the user. This solves a real issue. There are certain things that could be quite difficult to find on the web or getting real recommendations for people living in a specific country. Solving a personal problem for a user delivers the highest incentive for the user. If a tool could make their life easier and better, users would move quickly onto the platform to leverage the benefit.

2) Financial incentive
We will look at Innocentive, Innocentive is a collaboration site which allows companies to post questions regarding a specific problem like, formulating a new shampoo formula. These are relatively difficult questions to answer and requires deep specific knowledge in the problem. R & D departments cannot answer all the questions an organisation have and if they could “outsource” it to the pool of talent out there in the world, it was shown that this could help reduce the cost and R&D. Innocentive provides users with a monetary reward for the question that has been picked by the company. The reward could vary and its been known that researchers on Innocentive could get thousands of dollars or a small cut of the revenue. With a good amount of money in discussion here, people could possibly be interested in making a few thousand more.

3) Recognition and satisfaction
Just like contributing to a Wiki or a open source software project, there is seldom a monetary reward nor it could help solve a personal problem directly. However, there are people in the world who are highly passionate about something that they are willing to give up their time and contribute to a cause that is close to their hearts. In return if they do a good job, they will get public recognition (in many varous ways) from their contribution, be seen as a leader in that space and also be satisfied with their achievements. This form of incentive is somewhat unstable as there is a number of dependencies that is required for it to happen effectively. And I would like to note that there are alot of small open source projects out there that is driven by less than four contributors and I suspect that many of them are real life friends as well (just my observation).

Web 2.0 was never about some mindless people who has alot of time on their hands who just decides to do something. Humans have never worked this way and possibly never will. We live in a competitive environment and require some sort of return on investment and time. The above is just some of the high level incentives that should be considered while designing a new platform.

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