Rewards and monetization

Fred Wilson · February 3, 2010 · Short URL:

Thoughts on Glue announcing its new rewarding system for its "gurus"

I really like what Dennis Crowley, founder and CEO of Foursquare, said about "rewarding checkins" in this post on Business Insider:

Foursquare's [success] depends on providing "the most incentive for a user to check-in."

There are many ways to do that, including the game play dynamics that Foursquare does so well. But for me, the most interesting way to reward a checkin is to provide some real value at the moment of checkin. For example, when I show up a my local cafe in the morning and checkin, I'd love to occasionally get a message on my checkin screen that says "you've checked in for the tenth time and earned a free espresso drink."

I have no doubt that is coming and I am confident that Foursquare will be leading the charge in getting there.

The reason that is the most interesting reward to me is that it directly leads to the monetization of the service. These rewards are basically another form of coupons or offers and merchants have always responded well to the opportunity to pay a third party for the opportunity to coupon their customers and potential customers.

Which leads me to an announcement our portfolio company Adaptive Blue made about their Glue service yesterday. Glue is a social network in which users engage with and opine on things they uncover on the web every day. It exists both in your browser (via a browser extension) and at

Glue assigns the "guru" label to the person in the service who has engaged the most with a specific item. For example, I am the guru of 35 different items on Glue.

The announcement was that they are now rewarding "gurus" with rewards. As you engage with items in Glue, you'll occasionally be offered rewards like this one.

This notion of rewarding users with free offers can be expanded to many services on the web. And it provides everyone in the system with value. The service gets more engaged users. The user gets free stuff. The merchant gets to engage with the right person at the right time with the right offer.

I think we'll see more of these rewards showing up in our favorite web services. It's a different, and in many cases, a better form of monetization.

For more Fred Wilson check out his blog.

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