If you haven’t heard the news yet, Freelancer.com recently paid $3.2 million AUD (that’s roughly $3 million … and a steal of a deal considering that my estimations are that he shouldn’t be making less than $1 million a year right now, and Allen way under-utilizes the forum) to acquire the Warrior Forum from long time owner Allen Says. You can read the official post from Allen here.
There’s been a ton of speculation about what Freelancer might do with the Warrior Forum, but a lot of the speculation seems to be downright silly or stupid from a business standpoint, such as just redirecting traffic to Freelancer and so forth (no one in their right mind would do that to such a big and popular forum already making good money).
So I put together a list of what I would do if I were Freelancer, and what I really think they’re going to try to do in two different phases. Time will tell if I’m right, but I bet I am. :)
What Freelancer.com will do to the Warrior Forum — Phase 1
We already know that they lowered the initial WSO (Warrior Special Offer) pricing — the main marketplace at the Warrior Forum — from $40 to $20 to list your special offers for sale in their market (still costing $20 to “bump” it up again after a few days usually when it drops below page 3 in their forum marketplace), and we also know that they changed the War Room (a special sub-forum section where people share tips and give freebies) pricing from $20 one time to $20 / year.
However, in phase 1 I think their next step would be to introduce their own WSO network option where instead of users tracking their affiliate sales on the WSO forum through other WSO networks like JV Zoo and Warrior+ (or larger non WSO networks like Clickbank, Paydotcom, etc.) where most of those networks collect a fee per sale, they’ll have an option where you can use an option straight through the Warrior Forum itself.
Why does this make sense?
Simple, because it will mean more money in their pockets, and they can stand out by having more control over reviews, ratings, refunds, etc. than the other networks, which would give a major incentive to new users to use them.
Can they eliminate the competitors like JV Zoo, Warrior+, etc.?
Not initially — it’d be dumb of them to try to force WSO listings to go through them vs. just offering a big incentive to do so. They could piss off a large part of the community really quickly and risk the other networks trying to team up to drive the traffic outside of the forums altogether (something the other networks would be unlikely to do on a mass scale, but certainly could on a smaller scale with a handful of the vendors there).
So offering them as an alternative seems less intrusive and slowly builds their network. This will appease a lot of the members and prevent any major lash back, but that’s where phase 2 comes into play…
Phase 2 — The Takeover of the WSO Marketplace
Phase 1 will start right off the bat with some changes happening within the first few weeks, while the other parts might take a couple / few months to start up. After they start, phase 2 will happen anywhere from 6 months to one year later.
During phase 2 of this, Freelancer will already have their own competing marketplace in the WSO forum marketplace with a healthy portion of the WSO listings using them. Those listings will have extra benefits of easier ratings, more trustworthy reviews, more seamless integrations, etc..
And this is where the phase 2 plan really starts…
At that point in time, it’d be dumb of them to allow JV Zoo, Warrior+, and the others to really partake in their playground. It’d come off as less of a disruption if they kicked them out now vs. at the start, but they’ll have to go about it in the right way.
The best way to go about that would be to try to justify it for the better of the community, such as by saying that because of the reviews being abused by non-buyers or by the vendors themselves, they’re going to require that listings go through their own network so all of this can be verified for a better user experience (or something to that nature).
This will effectively be shutting down the other networks and giving nearly 100% control to their in-house network, which could mean massive profits for them.
But what will happen to JV Zoo, Warrior+, etc.???
For a short time, JV Zoo and Warrior+, who rely on the forum (despite what they may or may not admit) for their business, will try to act like that’s not a big deal and will act like they won’t need the forum, and they’ll do okay for awhile as they’ll have their band of loyal vendors that stick to them for awhile, but their lifeline will have been cut and without massive changes, they’ll likely die a slow and painful death.
The other networks that don’t rely on the forum will continue to obviously be just fine, though, and may even have a slight increase in activity during this time if everyone plays their cards right.
Could I be wrong???
Sure, I could be wrong (although I don’t think so), and there are a few possible moves that could change the above potential events slightly… For instance, Freelancer.com could make a lowball offer to buy one of the other forum networks.
I think it’d be kind of dumb of them to do that unless it’s a dirt cheap price (which the owners will be likely to turn down and will try to fight it out), but they’d have the benefit of starting with a base of users. However, unless it’s a dirt cheap price, they could easily get there themselves with controlling the entire forum to start with and being able to really push people into their new network if they create one (which almost certainly I believe they will).
Is it wrong of Freelancer to do this?
In short, no! If you drop $3.2 million, you have a right to try to get your investment back.
Why do I think they’ll do this?
Simple — because I would do the exact thing above if it were me. :)
Agree or disagree? Let me know below!
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