Crowdshopping is an innovative tool to use in real estate. If you take a look at some key indicators, you will see that it should have been invented long ago. First, let’s define crowdshopping.
It is a multitude of buyers who are interested in the same product and who are willing to compete for that product. While this definition might apply to people who like to participate in auctions, it applies appropriately to people who want a product but want to buy it at the lowest possible price.
Auctions usually offer a minimal discount. Crowdshopping offers a monstrous discount to those smart enough to take advantage of it.
Key Indicator #1: The Lottery
According to the US Census Bureau, $82 billion was spent on lottery tickets and other entertainment in 2008. 82 billion dollars. That’s a lot of money. People like to try to win something big for a small price.
Key Indicator #2: The Stock Market
Day traders and stock investors are risk takers. They are usually people who like to multiply their finances using information that tells them if their chances of success are high or low.
Key Indicator #3: Game Shows
Oh yeah, game shows. You can make poo poo game shows if you want, but they’ve been around forever. Look at the wheel of fortune. This show has been running for 30 years and still gets at least 10,000,000 viewers to watch other people make money.
Key Indicator #4: Credit Card Debt
The total amount of credit card debt in the United States is reported to be $793 billion. Second to the largest amount of student loan consumer debt, which is $956 billion. Auto loans equal to 768 billion dollars. If you look at mortgage loans, they would easily blow these three.
Conclusion? People want what they want. They are willing to pay more than 8% or even 22% in interest payments to get what they want when they want it.
Key Indicator #5: The Housing Bubble
People want to have their own house. We already know that it is the “American dream”, but in reality it is 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 increased the MSRP in order to put an item on “sale” at a 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 always existed. Although there is currently a downward trend in the game, it will not last long if the economy improves. Some people will always want something for nothing. They will always want to feel like they beat the system and made money that they would never have made going the traditional route.
How will crowdshopping make a difference?
Crowdshopping uses the conventional test-taking system to offer consumers another way to consume. To crowdshop well, you need 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 get a group of people together and give them the same test, and then you compare their scores to each other.
We have been taking tests since we were six years old. Taking tests is a skill that should not end after we graduate from school.
How can testing change the consumer market? You can change that by providing another option for consumers instead of traditional methods.
If you bring together people who have the same needs, like the need for housing, and put them in a situation where the cost of the product far exceeds the cost of the opportunity, you’ve now leveled the playing field. Now anyone can achieve the “American dream” by using his intellect, instead of solely by using his money.
The Internet
There are two billion people on the Internet. The Internet is the only place that can bring together millions of consumers at the same time. There is no better use of Internet technology than bringing people together to contribute to the needs of all.
What is the risk in massive purchases? Risk is the possibility of losing money. You can compete 1,000 times and never have anything to show for it. In that scenario, you may not have gotten the item you wanted, but you made it possible for 1,000 people to meet their needs.
The fee you pay to crowdshop becomes a donation.
Charity at its best
For thousands of years, human beings have donated their money to help those in need. Charity is a beautiful thing. The only drawback is that the few people who run the charities decide where all the funds go.
With crowdshopping, the vendor may be accepting small fees from a large group of people, but allowing those same people, through competition, to determine who gets to keep the funds. It’s not a perfect solution, but it will help solve real problems.
The key to crowd shopping
It has to have realistic quotas. It cannot be a sweepstakes or a lottery. It has to be more like a tournament. Every consumer has to know that he has a real chance of getting the product.