Due to overwhelming interest in our December blog regarding the “Peer to Peer” marketing model, we’ve decided to take a closer look at what makes this method so effective. You can find the prior post, here:
P2P = an untapped resource for many companies or individual’s marketing a product.
Once a revolution, P2P has become somewhat pedestrian in terms of public perception. Napster and Limewire created a platform for people to share media. These services spiked in popularity so wildly that it’s been taken for granted, especially after the legal disputes they each had to deal with. The fact is, with a tangible product that one has rights to (like apparel in the case of Karmaloop) the P2P and social media model is very effective.
One particularly interesting example is the online apparel retailer, Karmaloop. They have done 27% of their business through the peer to peer model. By allowing customers to sign up to become a “rep,” they can then share the unique promotional code with their various social networks like Twitter and Facebook for a savings of 20% initially, and 10% after the first purchase.
This model gives customers a reason to get involved with the company itself. By creating a peer to peer platform, Karmaloop was able to do something many companies have failed to utilize in the last few years; the power of friends.