Crowdshopping is an innovative tool to use for real estate. If you take a look at some key indicators, you will see that it should have been invented a long time ago. First, let’s define crowdshopping.
It’s a crowd of buyers who are interested in the same product and who are willing to compete for that product. Although this definition could be applied to people who like to participate in auctions, it is appropriately applied to people who want a product but want to purchase it at the lowest possible price.
Auctions usually provide a minimal discount. Crowdshopping provides a monstrous discount to those smart enough to take advantage of it.
Key Indicator #1: The Lottery
According to the U.S. Census Bureau, in 2008, 82 billion dollars was spent on lottery tickets and other amusement activities. 82 billion dollars. That’s a lot of money. People like trying to win something big for a little price.
Key Indicator #2: The Stock Market
Day traders and stock investors are risk-takers. In general, they are people who like to multiply their finances by using information that indicates whether their chance of success is high or low.
Key Indicator #3: Game Shows
Ah yes, game shows. You can poo poo game shows if you want but they have been around forever. Look at Wheel of Fortune. This show has been on for 30 years and it still gets at least 10,000,000 viewers to watch other people win money.
Key Indicator #4: Credit Card Debt
The total amount of credit card debt in America is reported to be 793 billion dollars. Second to the largest consumer debt pile of student loans, which is 956 billion dollars. Auto loans equal to 768 billion dollars. If we look at home loans, they would easily blow these three away.
Conclusion? People want what they want. They are willing to pay upwards of 8% or even 22% in interest payments to get what they want when they want it.
Key Indicator #5: The Real Estate Bubble
People want to own their own home. We already know that it’s the “American Dream” but it’s really about stability. They want to know that they have a safe place to come home to and they want to know that it can never be taken away from them.
Key Indicator #6: Coupons
People want to save money. They want a deal. They want a sale. Even if manufacturers artificially drove up the MSRP so they could place an item on “sale” at their desired price, consumers wouldn’t care. As long as there was an observable way to see that they “saved” money.
Key Indicator #7: Gambling
Games of chance: they have been around forever. Although there is a downward trend in gambling right now, it won’t last for long if the economy improves. Some people will always want to get something for nothing. They will always want to feel like they beat the system and made money that they never would have made going the traditional route.
How is crowdshopping going to make a difference?
Crowdshopping uses the conventional system of test taking to provide consumers with another way to consume. To crowdshop well, you have to be knowledgeable about the subject and able to perform under tight deadlines. It almost sounds like a job description.
It’s comparable to the SAT, LSAT, GRE, MCAT and others because you gather a group of people together and give them the same test, and then compare their scores against each other.
We have been taking tests since we were six years old. Test taking is a skill that shouldn’t end after we graduate from school.
How can taking a test change the consumer market? It can change it by providing another option for consumers rather than the traditional methods.
If you gather people together who have the same needs, like the need for shelter, and place them into a situation where the cost of the product far outweighs the cost of the opportunity, you now have leveled the playing field. Now anyone can achieve the “American Dream” through the use of their intellect, instead of solely by the use of their money.
There are two billion people on the Internet. The Internet is the only place that can bring millions of consumers together at the same time. There is no better use of Internet technology than bringing people together to contribute to the needs of all of them.
What’s the risk in crowdshopping? The risk is the possibility of losing money. You may compete 1,000 times and never have anything to show for it. In that scenario, you may not have gained the object you desired, but you did make it possible for 1,000 people to get their needs met.
The fee you pay to crowdshop becomes a donation.
Charity at its Best
For thousands of years, humans have donated their money to help the needy. Charity is a beautiful thing. The only setback is the few people who run the charities decide where all of the funds go.
With crowdshopping, the provider may be accepting small fees from a large group of people, but it’s letting those same people, through competition, determine who walks away with the funds. It’s not a perfect solution, but it will help to solve real problems.
The Key to Crowdshopping
It has to have realistic odds. It cannot be a sweepstakes or a lottery. It has to be more like a tournament. Each consumer has to know that they have a real chance of obtaining the product.