If you’ve heard of The Hunt, a social shopping website, and been reading some of my stories, you’d realize that I am a chasm away from being their target customer. I’m an old geezer compared to their target audience, and I’m also male. But, with that said, I know a good startup business model when I see one, and The Hunt is on to big things.
For those of you who don’t know The Hunt, its website successfully targets teen to young women who love shopping. My reason for admiring this business model is not because I share a teenage girl’s penchant for shopping, but because I like the way the company shifts the paradigm from inventory based marketing to demand based acquisition in a way that could apply to virtually any product. The idea, and the crowd sourced slant on this site, opens up new ways of thinking about marketing and social interaction. It’s genius.
Demand Based Marketing
Demand based marketing makes a lot more sense than inventory based marketing. In inventory based marketing, you promote, market and advertise what you have and you convince people that they need it. Why? Because that’s what you have in inventory. You can even drop the price just to clear inventory, and so on. It’s an archaic way of doing things, yet that’s how most businesses operate. Demand based marketing, The Hunt’s focus, is about selling the consumer what they’re looking for. In a world consumed with social media, be it pictures or videos, people now decide what they want based on what they see, online. So The Hunt has found a way to service the new ways of the consumer.
The Golden Decade Birthed Demand Based Marketing
In the eighties, automobile companies would try to sell so many variants of a model just so they could give the consumer what they wanted – that was one of the first attempts at demand based marketing, albeit an inefficient and costly one. This first attempt at demand based marketing ended up bleeding the autos dry. But they had the concept right – sell the person what they are looking for, not some homogenized product.
Now here comes The Hunt, and what they’ve done is taken crowdsourcing and paired it with demand based marketing. The Hunt allows a visitor to throw up an image – yes, an image, not text description on to the site, and other visitors will come in and solve where that product can be found (typically women’s clothing). The idea is astonishingly simple, yet brilliantly efficient for both the consumer and the marketer.
Test it out for yourself. Click here to visit The Hunt’s website. Put in a picture of what you are looking for, and see what happens.
For the consumer, The Hunt provides a simple way to find a product, obviously. Instead of clicking through a number of websites, and potentially hundreds of images, you can post a picture of what you are looking for and see what sort of similar or identical products can be bought. For the marketer, it gives them a pulse of who is looking for what, and where they are looking for it. That is real time, invaluable market intelligence. It eliminates the costly guesswork of trying to predict what the consumer wants.
Even though they’re new in town, The Hunt has ratcheted up half a million unique monthly visitors. Pretty soon that number will double, and triple. There is even an iPad/iPhone app for it, and nine out of ten users are using the app. Each repeat visitor stays on the site for approximately an hour each week. That’s incredible. The Hunt has a high engagement rate in a high growth market, making the possibilities seemingly endless.
There is a lot more that this idea can evolve into. I suspect Khosla Ventures is looking at it the same way. They just led a Series B round, raising $10 million. This is after an earlier $5.5 million at the end of last year. The funds will go into expanding The Hunt’s platform to Android users and getting more hands on deck.
To spur on the growth, Khosla put their partner, Ben Ling, on the Board of The Hunt. Ben has an amazing resume; he used to work for Google Image Search. Ben has a lot to offer in terms of how images work in a business. Image search is a leading edge tool in product marketing; you can start to see where this is going, and what Khosla has in mind.
Looking at the other image sites, like Pinterest, you find that The Hunt has a leg up in terms of active participation and where they could shepherd this idea.
The company isn’t making money just yet, but that’s not where the focus is right now. The idea is for this to catch on, like Twitter, and then focus on revenue. If it works, on a grand scale and is widely adopted, product corporations, more specifically the large clothing companies, will pay a fortune for such a service. I believe that The Hunt could become mainstream to the point where marketers and consumers interact to facilitate a more efficient market. Could you imagine?
To get to its full potential, The Hunt needs to move beyond just covering IOS devices, and they are in the midst of getting on that track. They also should open up their user interface to a point where it doesn’t matter what platform or device a person is on.
The hunt is also engaging the key component of the entire process, the site’s visitor, very effectively. Buy getting both sides of the transaction together (buyer and seller), The Hunt allows product designers and product marketers to better understand the consumer’s desires. This makes The Hunt a strong buyout candidate for someone like Apple, Facebook or Google, who could do well to engage this demographic and this utility. If you are a product developer or a retail entrepreneur, The Hunt has just given you a sneak peak into the future of online sales and marketing.