business-modelI was always wondering what is the point of newly launched websites, services and startups, to accept new users only by invitations.
I have an example of oneplus.net smartphone. To take one, you need to be invited.
What is the business model behind it?
Gmail is another BIG example (obviously not anymore, but a decade or so ago when they launched you needed an invite to get a MASSIVE 1GB email account!)
But why? Well, there’s a couple of primary reasons I’m aware of.
1) Broader testing before opening to the general public. Hopefully you’ve already done some decent testing by the time you get to launching anyway, but its always hard to predict exactly what will happen when you open it up to a flood of new users from the general public. The invite only system slows that flood down to a level where you can more easily manage fixing any problems that do inevitably crop up.
2) Exclusivity. If leveraged correctly, the exclusivity of needing an invite to get into the system can be a powerful marketing and branding tool. The psychological effect can make those who have signed up more loyal as they feel like they’re part of an exclusive club with the power to allow or deny new membership. It gives them part ownership, which is a powerful thing (the psychology of “ownership” is a big part of the reason the Stack Exchange network works). And if leveraged correctly, the exclusivity can make those without invites want even more to part of the club.
3) Promotion. Along those same lines as point 2: If your users feel like they partly “own” the site and are responsible for it, and if they like your service, they will want to see it last, grow, and improve. So in a sense, they will feel like they have a responsibility to invite their friends, and specifically friends they think would like and use it. Who better to help you find and connect with your target audience than those who have already proven that THEY are your target audience. Your customers are very likely to have friends with similar needs and interests.
4) Feedback. This somewhat ties into the point about testing. Okay so you’ve developed a tool or service, and maybe you’ve done some focus groups to get feedback. But again, what is going to happen when the general public gets a hold of it? Once again, here is a way to turn that flood of feedback into a slower stream. And now you have a chance to respond to the feedback and make changes/pivot if you need to whereas if you’d fully opened the service to the public it would be harder to change.
I’m sure there are other reasons. In some sense you could make an endless list of the reasons different companies have had over the years of doing something like this. But those are some of the bigger reasons I’m aware of.
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