Loyalty: There’s the Yub

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Feb 21, 2005
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By John Hennessy

Internet retailer Buy.com recently, and quietly, launched a companion social networking site call YUB.com (http://www.yub.com). Short for Young Urban Buyers (and conveniently “buy” spelled backward), Yub rewards members for making product recommendations.

Unlike other social networking communities such as Friendster, Yub membership also comes with an economic benefit. Yubbers (as they’re called) earn rewards and points for the role their product recommendations play in helping other Yubbers buy products.

If you buy through another Yubber’s link, that Yubber earns Yub points on the sale. Yub points can be redeemed for cash after 1,000 ($10) points are accumulated.

Yubbers also earn discounts on purchases they make through the Yub site.

The Yub mall currently includes Target, Foot Locker, iTunes, drugstore.com, with new tenants planned such as Linens and Things.

Membership in Yub comes in two flavors – free and paid. The paid version is currently $19.95 for a year. For that price, you earn a larger percentage on purchases made and gain expanded social networking tools; picture posting, saved message limits, subscriptions to other members, etc.

Moderator’s Comment: How can other retailers wrap communities around their stores to encourage greater loyalty? Is the risk of negative feedback from
members an impediment to more widespread adoption of this approach?

Buy.com’s goal is pretty clear. They want the advantages of Yub community membership to make Yub the place where twenty-somethings go to shop.

They’re using some economic flypaper to encourage stickiness. Members earn points for their recommendations. This encourages members to engage and make
frequent recommendations. Members gain discounts on purchases, which encourages consumption and drives sales. And members make new friends, which creates a non-commerce driven
reason to return frequently to Yub.

In the face of a barrage of messaging and increased skepticism, the community recommendation approach alone is a strong benefit to shoppers, particularly
online where there is no ability to interact with the product. Adding the economic component makes it even more appealing and should be a carrot that encourages active participation.

Rather than stand still and watch Amazon, eBay and others eat their lunch, Buy.com is stepping up and fighting back with what they hope is a unique advantage.
Retail innovation like this sure beats a price war.

It will be interesting to track how Buy.com’s Yub initiative helps sales at Buy.com and the Yub mall partners. Right now the focus of Yubbers seems to be
more on community. But it’s still early in the experiment.

John Hennessy – Moderator

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7 Comments on "Loyalty: There’s the Yub"


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Art Williams
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Art Williams
16 years 13 days ago

Recommendations for a product from someone that you believe is not biased and is knowledgeable of the product has always been very strong. This is the basis for Consumer Reports and other consumer testing services. This concept is very appealing and it will be interesting to see how it works out.

Mark H. Goldstein
Guest
Mark H. Goldstein
16 years 13 days ago

As a yub user, I’ve concluded the site contains pretty entertaining material but as Peter mentioned, the wheat and the chafe don’t get split up well. Thus the site ends up being more a match.com where the product content is secondary and one’s getting “action” becomes the primary goal!

I hope I’m wrong here but web user generated content and recommendations simply haven’t scaled well yet… but maybe buy.com can get it to work!

M. Jericho Banks PhD
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M. Jericho Banks PhD
16 years 13 days ago

It appears that YUB.com members are rewarded for recommending products, not for being truthful about them. If there is no incentive to provide less-than-positive feedback about products and shopping experiences, then the so-called recommendations can hardly be trusted — they’ll all be positive, regardless. How long will it take shoppers to figure this out?

Successful online retailers refrain from sponsoring chat rooms for a reason: There’s no percentage in inviting negative comments. But without a sprinkling of criticism, how will anyone consider YUB’s feedback legitimate?

Peter Fader
Guest
16 years 13 days ago

This kind of scheme doesn’t build a “community,” it just creates headaches for customers and retailers alike.

Countless firms tried something like this during the Dot Com heyday, and it failed miserably every time.

The overhead required to set up and manage something like this more than offsets any incremental gains it might provide.

Retailers are better off sticking with the usual pillars of good business (quality, selection, service, and convenience), rather than trying to reinvent this square wheel.

Bye bye yub.

Marilyn Raymond
Guest
Marilyn Raymond
16 years 13 days ago

Whether these programs create loyalty (a long lasting relationship) or hype (hot today -gone tomorrow) is something worthy of reflection. I do like the idea of peers helping to sell but is some random person in a chat room a peer? I’m not too sure about that.
I do think a picture speaks a thousand words – and if you saw this person – his/her persona – then perhaps it would be more compelling. Think QVC/TV sales!

Mark Hunter
Guest
Mark Hunter
16 years 13 days ago

Best thing about this is the term “YUB.” After that, there’s not much to get excited about. There’s way too much work and intrusion for anyone to get excited about, and considering that is what they’re trying to create, there’s a strong disconnect. It certainly is not the way for a retailer to create strong loyalty. Any loyalty gained will be gone in a flash when a better deal comes along.

Roland Januzzi
Guest
Roland Januzzi
16 years 5 days ago

There appears to be much skepticism about YUB-like programs and I would agree. What is interesting is that there is an online retail community that utilizes a loyalty program and currently generates over 1 billion dollars in annual sales. Of course, this is met with much skepticism as well, but why? One billion dollars – think about it.

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