We're sharing a recent post from the community by Danny Martinez (previously Airbnb, eBay) on our blog, which is on the importance of establishing trust as a marketplace. This was originally shared as a post in the community here.
One thing I’ve observed in my experience working at marketplaces (like Airbnb & Prolific) is the importance of trust. You may have already read about Airbnb’s $1M liability insurance program or eBay’s money back guarantee. You might be asking what can you specifically do to foster trust in your early stage marketplace, before you've reached this level of scale though.
To help with this, I wanted to share three ways (with specific examples of tactics) you can do this, which I’ll discuss through the lens of the previous marketplace startup I worked at, Prolific as the Head of Growth.
For context, Prolific is a marketplace that connects researchers to participants for behavioral research studies. Imagine a behavioral research scientist trying to find participants for their online surveys. This product connects them to participants for an hourly fee (prorated for survey duration).
Get your existing evangelists to recommend your product. A pro tip here is to get the recommendation to be as specific as possible: "It’s great" or "I'd recommend!" are fine, but getting into specifics is much better from a new user's perspective.
At Prolific, superior data quality was often highlighted in product market fit surveys. In most of these cases users would compare it to the better known competitor, mTurk. The common theme was that mTurk was cheaper but had a lower quality of participants. Using this copy on customer facing materials always showed better conversion.
What better way to get someone to trust your product, then by getting someone they trust to recommend it? There are nuances to be aware of here: especially with minimizing fraud. Note: I say minimize, because avoiding it completely is close to impossible, but as a channel it's very scalable.
At Prolific, word of mouth was effective in the early days, as is the case with a lot of startups. Putting a paid referral program in place accelerated something that was already happening. Note: this is usually a great signal that something is worth building into your product!
A lot of marketplaces struggle from people's inertia to try a new service. This is especially true for transactions that are peer to peer. "What if the item/service I buy isn't legit" is a common hesitation. A common way around this is to cover the cost on the first transaction (e.g. The first taxi I used on Uber in 2012 was free!).
At Prolific, we identified target companies and sent them the results of a basic survey we’d run for them. It’s easy to ignore an outreach email that talks about all the amazing things a product can do. But when we showed them the survey results (i.e. what the product could do), we saw open rates on outbound emails increase significantly.
These are some of the tactics I've seen work. But as I've learnt (the hard way!) tactics are not universal, and what works for one marketplace may not work for another. With that in mind, I’d love to hear from the community: What tactics have you found to be the most effective at building trust?
You can connect with Danny to discuss this post in the Everything Marketplaces community here. A big thanks to Danny for also being an active community member, where he is often sharing his marketplace experience, insights, and helping early stage founders.