Let me just say this upfront: I’m not really a fan of Chatroulette.
A few days ago, I taped a piece of lined paper across my webcam and spent about an hour on the service. A lot of the people I saw were strange but pretty benign: many had their cameras pointing at arms or legs, I saw a young man sitting in his underwear, a few nice looking girls, and quite a number of old men in shirtsleeves. Then, inevitably, I found myself up close and personal with male genitalia. Before I had time to fully register what I saw and hit the “Report Abuse” button, I was Nexted, so unfortunately he is probably continuing to horrify other people as we speak. But apparently this is normal and to be expected with the site, so let’s just say it’s not my cup of tea and I probably won’t be going back as a customer anytime soon.
That being said, I think Chatroulette’s founder, 17 year old Russian Andrey Ternovskiy, is on to something here. With all the buzz surrounding Chatroulette these past few months, one wonders if it could rid itself of its pornographic association and turn into a legitimate social networking site or some kind of speed dating service.
Sure, it is really just callous voyeurism, but if you put aside the obvious distaste for the concept, you’ll see that Chatroulette creates a social environment unlike any other you might have encountered before: it is an impersonal, anonymous, live meeting place that has no social context and shatters everything we know about what we should do after making eye contact.
It’s not real life, it’s not chatting, and it’s not like being on a social network or dating site. Truth be told, I don’t like it. But it intrigues me, as a lover of social media, as an observer of consumer behavior, and especially as a marketer.
As Andrey considers moving from Russia to the U.S., I’m sure he’s thinking about how he might be able to monetize this service and start making some money off of it. From a product perspective, he is reportedly launching some new features, and he certainly needs to augment the Report Abuse button and somehow really fix the problem of people coming across random nakedness on the site. But what are his monetization options?
Option #1: Advertising
Of course, this is always the easiest way to start making some cash. Apparently, Andrey was running Google Ads/Adwords on the site but stopped recently. I didn’t see any ads myself, but as people start warming up to the idea, some (possibly unsavory) advertisers are going to want in and start taking advantage of a captive audience. But banner ads flashing to the side are really going to ruin the experience, and if people are forced watch :15 commercials after every 5 clicks (a la Pandora), the site will lose its appeal entirely.
Option #2: Promotions
FCUK, the racy and risk-taking U.K. clothes retailer, just launched a promotion on its website promising a 250 GBP/$375 shopping spree to a man or woman who can prove, with a screenshot, that they managed to pick up someone on Chatroulette. Given its brand image, it’s actually not a bad way for FCUK to appeal to its core audience. No word yet on the success of the promotion but I suspect it might be successful and open the door to other advertisers. Neither FCUK, nor its agency, asked Chatroulette for permission before running the promotion but if Andrey wisens up to what is happening, he could institute a fee-based model for such promotions that might work in his favor.
Option #3: Virtual Goods
If ChatRoulette doesn’t get rid of the pervs, the above options will not attract advertisers. In such a situation, Andrey could explore creating a virtual goods economy within Chatroulette. Here’s how it would work:
Nobody likes getting Nexted, especially if its by someone they liked and wanted to talk to. So what better way to signal that you’d like to get a conversation going than by sending a nice virtual gift? Users could buy currency packages beforehand in, let’s say, $5 increments and have a gift panel right on the chat screen containing items ranging from roses to champagne flutes to racy lingerie, each with a different caption and price tag, thus indicating different levels and types of interest. When they came across someone they liked, they could click on the right gift and, within a few seconds, the gift would appear in the chat window. Their account would instantly be debited of the necessary credits.
The gift would help the sender show the nature of their interest and help initiate a longer conversation (i.e. help senders avoid being Nexted) as the receiver might be enticed to pay attention to someone who took the time to make such a gesture. When the credits ran out, the user would buy some more and keep on gifting to score chats. And Andrey would keep ringing in the dollars.
It will be interesting to see how the product evolves as Andrey starts meeting with U.S. investors and techies. The whole phenomenon might die a quick death if it remains a proxy site for porn. But seeing how much press Chatroulette has gotten in the New York, New York Times, USA Today, Fast Company and The Daily Show – as well as splinter sites like Chatroulette Map that have already popped up – it’s possible Andrey might make it big with Silicon Valley insiders.
In which case he could always fall back on option #4: sell it all and retire before he turns 20.