This week’s volunteer for my Site Review Monday post is Alfie John, founder of Victoria, Australia-based Freehouse.
Freehouse is an online classified ad Web 2.0 site where you can post real estate, houses, apartments and rooms (“Single room with polished floors, furnished, share with 2 humans, mature, quiet and a cat, immature, cunning”) to rent, share or buy. Listing and viewing listings at Freehouse is free; like many Web 2.0 sites, this micro-ISV makes its money off Google AdWords.

I think micro-ISV web apps can make money, in fact lots of money, but before we get to the money, let’s cover the three large defects in Freehouse’s current approach.
The USP:

(The Unique Selling Proposition a.k.a “the elevator pitch” should be the first thing the visitor sees, communicates the value of the product and must immediately be relevant to the visitor.)
Freehouse does not have a USP. Or for that matter, any explicit description of what it does:

Now I know in the Web 2.0 world less is more, and that it’s pretty easy to guess what this site is about from the above, but why make it at all difficult on your visitors? Especially since Freehouse does a great job of handling the plumbing – the site is fast, images are very crisp and clear.
What’s more, of the top five sites I found for “rentals” by searching at Google Australia, 4 were stuffy, complicated, flashing ad affairs and the fifth site would not load. Digging further, I found http://flatmates.com.au/ and http://www.gumtree.com.au, Freehouse’s two closest competitors.
Flatmates is an old style mid-nineties site that requires registration to see or post; gumtree is more with it, but it doesn’t show the photos of what you’re considering unless you go the extra step each and every listing. This type of competition should be easy meat for a well done Web 2.0 site like Freehouse.
But you have to tell people what Freehouse is about!
Here’s a couple of possible USP’s for Freehouse:

  • “Find your next flat in seconds, post your rental in minutes! For free.”
  • “Freehouse is a free service for both Australians looking to rent a room, sell a house or share a flat or who want an uncomplicated preview of their next home, office or holiday stay.”

What is the right USP for Freehouse? A lot depends on what Alfie decides to do about what I say after this next issue.
Ask not hard questions

The second defect Freehouse needs to look at is that the very first thing it asks a visitor for is which suburb they’re interested in. Now this may sound like an innocuous question, but look at it from the site visitor’s point of view – odds are good they may be looking for a rental or real estate purchase in a number of suburbs, or in an area that’s not properly a suburb at all. It opens a can of worms right off.
Instead, it’s time to put Google Maps to work in a mashup of your data and Google’s maps. Maps are the most logical, and familiar, and relevant way of displaying and selected geographic-related data I know of.
By the way, there’s an excellent book out there by Steve Krug, “Don’t make me Think!” (five stars, 329
reviews!) that walks you through and around this common web site pitfall: making the visitor have to refocus on what you mean for them to do instead of just being able to do it. I recommend it.
All things to all Aussies?

The third thing I recommend Freehouse do is drop commercial listings. In fact, I could argue Freehouse should drop (at least for now) holiday listings too. And selling/buying real estate. And everywhere else than its core market, Victoria. Freehouse is making the all things to all people mistake – instead, focus on one segment, in one place. Freehouse is trying to cover the whole of Australia – a near impossible feat.
Then, and only then, can Freehouse start doing the things that will bring its numbers up to the point where it can be making a profit.
Numbers = revenue

Any site or blog or Web 2.0 application that is going to be ad supported needs visitors, and lots of them. Here’s a few ways how to your numbers up:

  1. Get the word out. Even – and perhaps especially – free services need marketing and publicity to build a following. Let’s start with my favorite way of getting the word out, a blog. Should Alfie do a blog with 5 different ways of saying how great Freehouse is? No! Should he do a blog focusing on all the things it takes to rent a room, flat or house successfully either from the point of view of people renting? Absolutely! Topics could include everything from the best way to handle deposits when sharing a house to who’s offers what deals in Melbourne for move out clean ups. And a few dozen other related and relevant topics. (city pleasures vs. suburban ease, rental prices going up or down, taking good snaps of your flat to post, etc.).Done right, a good localized blog focusing on the issues facing someone trying to rent out there room, flat or house will get the online attention Freehouse needs.
  2. Get the word in. In the student commons at universities during the first and last few weeks of each term. In church, sport, civic newsletters. In pubs and clubs in areas with more mobile populations. Yes, I’m talking paper (recycled), old fashioned fliers that cost next to nothing to run off and absolutely need to lead with Freehouse’s USP.
  3. Get the word over the airwaves. While no newspaper in its right mind will take ads, radio is another matter entirely. Especially small, locally owned stations unencumbered with a chain. Not long winded 60 second spots, but quick and snappy 15 second pops (“Need a place to live next term? Visit Freehouse.com.au today. It’s free!”) What’s more, more than a few small stations will be happy to provide the talent and help you with your copy (keep it short though). As a listener I’m not a big fan of traditional advertising, but for bulking up numbers, nothing beats non-permission advertising because it’s all about getting the numbers.
  4. Look to the social networks. Web 2.0 micro-ISV sites and online social networks are made for each other – at the very least Freehouse needs a presence on the Australian versions of Facebook, Myspace and Digg.
  5. Did someone say Google? What struck me as odd was that while checking Google Australia for this review, I saw not one Google AdWord listing. That might be because Google AdWords is smart enough to not serve its adverts to someone in the states, or it could be there’s no one advertising. If the latter, and you’re prepared to spend money before you make money, AdWords can make great sense if you carefully control spending and use smarts to keep the price down. Check out Dave Collin’s weekly posts here for more info.

So where’s the Money?

Monetizing a Web 2.0 site is in many ways like monetizing a blog, and while I could type a few thousand words here going over what I covered in Clear Blogging, let me send you to the Aussie who know the alpha and omega about monetizing blogs: Darren Rowse at http://problogger.net. Plan to spend a good check of time at Problogger – there’s simply no better online resource.
The takeaway:

Freehouse is a well executed Web 2.0 site that has the potential to make good money, if and only if it does three things:

  • Narrow its focus considerably. A site for student housing, a site for alternatives to expensive hotels, a site for the buying and selling of certain kinds of commercial real estate – all would work, but not combined into one. Pick the one with the kind of people you want to be around with and focus.
  • Develop a catchy and compelling USP that it can lead with, leverage in all of its marketing activities and differentiate itself from similar sites.
  • Develop a marketing plan, and execute it.

[tags]Web 2.0, Freehouse, micro-ISVs, Site Review Monday[/tags]

3 Comments

  1. Wow, what an incredibly comprehensive review! You have definitely given me much food for thought.
    I think with a combination of some of your suggestions I can appeal more to the user experience. I just need to bite at a couple of points though šŸ˜‰
    “Freehouse does not have a Unique Selling Proposition” – Yeah, my bad. I think while designing I drank the Kool-aid of ‘less is more’ and looked for the least amount of elements to get search working.
    However, there was a main driver for this – my experience while looking for my first home. I got really frustrated by the clutter and the amount of clicking needed to be done just to find what I was looking for with other sites. The rest they say is history šŸ™‚
    I will be adding a USP soon though!
    “I found http://flatmates.com.au and http://www.gumtree.com.au, Freehouse’s two closest competitors” – Having people register just to search? I really don’t see this as sustainable in today’s climate.
    Gumtree is a different story. They have the traffic I am aiming towards, but their marketing budget is huge! I guess it would be huge when you’re a subsidiary of Ebay šŸ™‚
    “It’s time to put Google Maps to work in a mashup” – I’ve seen this in action and didn’t like it. With the outdated bandwidth speeds of Australia, I would absolutely see this as suicide. Maybe Google Maps works like a bullet in the US, but down under it’s a dog. Especially with mashups šŸ™
    However I did argued this point with my girlfriend. She said that Google Maps would be better, especially when you can see the surrounding areas. I then asked her if she could read a map.
    “The third thing I recommend Freehouse do is drop commercial listings. In fact, I could argue Freehouse should drop holiday listings too” – This is a really interesting scenario. At least for the short term as it builds usage. I think I’ll follow it up and do some prototyping.
    “Get the word out” – This was actually my next step with Freehouse. Building content that would be really useful to my user base.
    “Get the word in” – Sounds expensive. Currently I really don’t have that much of a budget for IRL (In Real Life) advertising. I think for now i’m going to have disagree with this point until I get a bigger budget.
    “Look to the social networks” – I’ve tried. And failed! I actually started a small blog (http://www.freehouse.com.au/blog/) and got a bit of traffic from it. However, most traffic came from the US and Europe. Unless your product has the word “Apple” in it and called it iFreehouse, or has anything to do with “Top 10”, Digg/Reddit is not my market.
    “Did someone say Google?” – Doing it. But because of budget constraints, I’m targetting it to Australian only. I’m thinking about your advice with localizing it to Victoria. Not to sure about this one yet though.
    “So where’s the Money” – Unfortunately like many before me… I need get the eyes. I have a big plan for monitizing Freehouse. A lot of it. I just need the eyes damn it šŸ™‚
    Once again, thanks for the really comprehensive review. You’ve done a great job at ripping it apart and having a lot to say. You’ve got my ball rolling again!

  2. Alfie — how’d your girlfriend respond to you asking her if she could read a map? I’ll bet you’re probably using freehouse to find a new place to live šŸ˜‰

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