

reddit gold, one year later (spoiler: the naysayers were wrong) - raldi
http://www.reddit.com/r/raldi/comments/isk36/reddit_gold_one_year_later/

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acangiano
One point that hasn't been made is that part of Reddit Gold's success is due
to the fun way in which it is presented. Reddit Gold members are jokingly
considered to be an ultra high-brow, elite group that hangs out in a lounge
with their monocles, top hats, Bentleys, and yachts.

It's a playful inside joke that makes people want to be in it, even if the
actual features of a premium subscription are negligible. It's also common to
have people give each others gold subscriptions in response to kind acts or as
a reward for particularly insightful comments.

There are lessons to be learned for those implementing the freemium business
model, for sure, although I completely disagree with people who claimed that
this is an indication that advertising doesn't work. Selling products or
services often beats advertising (revenue wise), but there is plenty of money
to be made with ads. (I speak firsthand, as I've always done well with ads.)

~~~
ghurlman
Sounds an awful lot like the TotalFark model (and userbase attitude) that's
been around for years... probably a lot of crossover there as well.

~~~
kn0thing
Definitely. I'd been chatting with Drew about lessons learned from TotalFark
for quite some time before Gold.

~~~
raldi
Props to the guy I'm replying to, for cultivating a community that was
receptive to crazy ideas like this.

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greendestiny
I think it says a lot of bad things about online advertising that a completely
voluntary subscription program that gives you essentially nothing beats it as
a revenue source. Although that's just a guess, the success of reddit gold
might be increase in revenue without having to serve more traffic.

~~~
speckledjim
It says nothing about online advertising. Reddit is pretty much the worst
website to try and advertise to. The community is extremely anti-advertising,
anti-capitalism anti-big-companies, etc etc. Coupled with that I don't think
the demographic is one that spends big money. They're not shopping for
holidays or cars, they're mainly wasting time.

Your comment has been upvoted to the top (I believe) because unfortunately
that same culture of anti-advertising spills over to HN.

Remember. Google made $9bn last quarter, mostly from online advertising. A
massive amount of that (about half?) went to 3rd party websites. There's money
in this game...

All this post says is "Donations are successful for some value of 'success'".

If it was really all _that_ successful, I don't think all the employees would
have left.

~~~
shiftpgdn
I'm going to agree. I've run quite a few ads on Reddit recently and our CTR
was absolutely abysmal. One ad campaign had .01% CTR with 0 conversions.

On other sites we typically see 1-3% with a decent conversion. I threw a lot
of money at Reddit and was REALLY disappointed with the outcome.

~~~
bane
We've been toying around with advertising on reddit since our product is
designed for the reddit userbase...we've been hesitant for exactly that
reason...and their advertising seems a bit pricey considering.

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c1sc0
What I liked most about the Reddit Gold program was how it shows the strength
of the community: if you can pull off a 'freemium' move without actually
developing significant extra features you're clearly doing something right.

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tokenadult
The real bottom-line question for Conde Nast, the company that bought out
Reddit, is when does the earnings stream from Reddit begin to pay back the
investment used to buy Reddit at a reasonable rate of return? I have seen NO
reporting at all that refers to actual numbers and "shows the work" to
demonstrate that Reddit was anything other than a losing investment for the
company that bought Reddit. If anyone reading this has a link to a thorough
analysis of how Reddit contributes to Conde Nast's financials, in light of the
large up-front (and now sunk) cost of acquiring Reddit, I would be glad to
give it a careful reading, financial calculator in hand.

~~~
scorpion032
If a computer programmer buys a large real estate and says he hasn't got any
return out of it, by not building anything, does it suggest real estate
inherently is bad?

It takes commitment, knowledge and a careful execution to see a site that gets
over a billion page views every month, to monetize. For that, let's start with
not pissing off the people who work on it, first.

If conde has already paid a large sum to acquire a property, how much more,
percentage terms, would it really cost to add a few more servers, a few more
developers, ad-ops? If you can't pay for gas, you should think about it, even
before you buy a car.

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ohashi
I was hoping for some numbers. Glad it worked well though and the timing was
fantastic :)

~~~
raldi
And I wish I had permission to share them. :)

I will point out a quote from the original reddit gold announcement: "Conde
Nast allocates resources proportional to revenue."

~~~
redthrowaway
How do you still have access to said numbers?

~~~
raldi
I was at reddit through March, which included the time when the big hiring
wave was approved.

~~~
redthrowaway
Ah, so you just remember the fairly recent numbers. I thought from your
comments here and in the linked post that you had access to current numbers,
which would have been fairly odd. Carry on.

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rospaya
The Digg implosion is the worst thing that happened to reddit, as a community.

~~~
redthrowaway
I don't feel that way at all. As reddit grew, the desires of the masses
changed. I'm no longer interested by the majority of it, but that doesn't mean
it's bad. In fact, millions of people seem to believe the opposite.

I don't use reddit anymore because I found it to be an unproductive use of my
time, but that doesn't mean it's bad. Youtube, for all of the stupidity of its
comments, has nonetheless grown a fairly tight community of people who
interact with each other through videos. Wikipedia, for all its politicking
and acrimony, has a very tight community of core contributors. Reddit's
community isn't the same as it used to be, true. It's much larger and much
broader in appeal. Sure, that means I'm not as enamoured of it as I once was,
but it's hardly a death knell. In every measurable way, reddit is doing better
than it ever has.

~~~
raldi
"Reddit is turning into Digg." -redditor, 2005

[http://www.reddit.com/r/reddit.com/comments/17913/reddit_now...](http://www.reddit.com/r/reddit.com/comments/17913/reddit_now_supports_comments/c228)

~~~
shii
Well, he was right. The Reddit frontpage and vast majority of the new users
(new being under 2/1 years old accts) have turned it into a complete
idiocracy. On the other hand, the niche and smaller subreddits about specific
pursuits and topics are doing pretty decently. Hivemind think and other
stupidity still leaks in, but it's not too bad. The problem is as subreddits
grow, they turn to crap. Look at the problem with the starcraft subreddit or
plethora of marijuana subreddits.

I particularly like the subreddits that aim for better signal/noise ratio from
the get-go and the good folks that help police them. One particularly
outstanding fellow is blackstar9000, mod, creator, and prolific
poster/commenter of several nice niche subreddits who has helped keep things
in line. If there's any one who deserves some kudos in that regard, I'd
nominate him/her for the honor.

------
cypherpunks
I read reddit, but I would never buy a gold account. The site has too much
hate speech, and it is hard to support that financially. Between the misogyny
and the atheist anti-Christian bigotry, it's pretty bad. You don't have to be
either a woman or a theist to see that's wrong.

The question of how to address this issue while maintaining free speech is a
more complex one. The reddit founders, however, have shown no interest in
finding ways to improve site quality from this perspective, and indeed, appear
to support the bigotry.

Anyway, I bear a huge grudge against the site because they banned my account
for sockpuppeting and harassment, so take all of the above with a grain of
salt.

~~~
naner
_The site has too much hate speech, and it is hard to support that
financially. Between the misogyny and the atheist anti-Christian bigotry, it's
pretty bad. You don't have to be either a woman or a theist to see that's
wrong._

The site doesn't promote hate speech, it allows free speech. Also I think
you're overstating things.

 _The question of how to address this issue while maintaining free speech is a
more complex one._

Free speech and censorship are mutually exclusive. Reddit already has
mechanisms to allow community censorship (report posts, post deletion by
moderators, banning, invite-only subreddits, etc.), but paid reddit employees
only step in when things get out of hand.

Also the community is very fickle. Any perceived censorship by reddit
employees that seems suspect and they get out the pitchforks. This has
happened a few times (e.g. the Sears incident).

I do think the front page could be better filtered, though. Right now the
default reddit front page is pretty... weird.

~~~
Terretta
To make it less weird, run something (e.g. RES) to filter out all posts
linking to imgur. You'll be amazed at the difference.

~~~
SkyMarshal
RES, for anyone not in the know: <http://reddit.honestbleeps.com/>

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braindead_in
Inspiring. "It won't work" should be on the checklist for every entrepreneur.

~~~
sorbus
People claiming that something won't work is not a good heuristic for finding
things that will work. It may be the case that people say that many ideas that
turn out to work won't, but they are overshadowed by all of the ideas that
people say won't work that don't.

~~~
raldi
True: People also said the CueCat wouldn't work. So sometimes the naysayers
_do_ know what they're taking about.

~~~
malnourish
Perhaps I'm missing something, but that seems to have resurfaced (in a sense)
with QR codes.

~~~
mooism2
The big objections to CueCat, as I remember them, were that people would never
install the hardware (and if they tried they'd need tech support), and that
dragging adverts over to the desktop computer would be too much hassle.

QR code readers are a software (not hardware) install, and they install onto
your phone (not PC), which is quite naturally close at hand when your reading
off paper.

I'm not saying QR codes will proceed to establish themselves long-term. I am
saying that if they don't, that will tell us more about the potential
ecosystem for this sort of thing than CueCat's failure did, simply because
major usability frictions inherent to the earlier technology are now out of
the equation.

