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Yerdle's Critics Miss the Point

Words by Nick Aster

TriplePundit Sponsored Series

The Rise Of The Sharing Economy

In case you're not familiar, yerdle is an online marketplace in which people can give away things they no longer want, or lend things out they don't use very often.  It's a classic sharing economy concept with big potential to make more efficient use of goods that would otherwise be thrown away.

Salon's Andrew Leonard wrote a fairly scathing review of yerdle's new credit system on the grounds that it dishonestly suggests the service is free. He further implies that yerdle is yet another PT-Barnum-style huckster start-up tech company claiming to offer something for nothing with a secret future business plan that will somehow screw people.

On the first point, Leonard is correct.  Yerdle's new credit system requires users to give away things and do other tasks in order to earn credits which can then be exchanged for goods.  There's talk of being able to buy credits with cash in the future.  For all intents and purposes this means you can't get anything "for free" on yerdle anymore - you have to do something, whether it be give away products of your own or some other action. The point is, there's a cost even if it isn't expressed in dollars.  So, yerdle might indeed want to reconsider their use of the word "free."  But the notion that yerdle has much in common with a bait and switch tech company is unfair.Yerdle's mission is to combat unnecessary consumption by making use of idle goods - those old products that fill closets and garages around America. It's easy enough to let storage spaces clutter, and offering goods to friends and family is time-consuming and inefficient at best. For folks seeking a second life for goods beyond Craigslist's free stuff section, the curb, or a trip to Goodwill - yerdle provides a community of people committed to generosity and reuse. That's what yerdle is banking on by introducing the credit system.  The credit system is designed to encourage gifting and to keep the system full of high quality goods.

As for Leonard's assessment that it represents a nefarious motive, forcing people to earn credits was not a part of yerdle's original game plan. My understanding is the adaptation came as an adjustment to the inherent challenge in building a critical mass of both goods and people looking to post things for free online. Craigslist has the market cornered and still remains a quick and convenient way to get rid of unwanted swag (at least in San Francisco).

However, if yerdle can scale the "free stuff" model to a national audience then there's a chance it can do something that Craigslist can't: Let Jimmy in Kansas City have access to that ugly lamp you've been trying to get rid of in San Francisco.  If Jimmy is willing to pay for the shipping and if some credits are enough incentive to convince you to package it up and carry the thing down to the post office, then we've got a real win-win-win.

The third win, of course, is for the shipping company who stands to gain some extra business. If yerdle continues to scale, tapping into the shipping fees people are happy to pay could provide revenue for a company with a business model based on free giveaways. That's income that is only earned from folks who opt not to pick up items locally - which is more of a "fremium" model (to use Chris Anderson's parlance) and seems like a reasonable option to me. It also preserves a model for local exchanges that can work on non-monetary credits.  If it works, then maybe credits won't be needed at some point in the future and a truly free exchange will be possible.

So yes, at this point it's a stretch to say yerdle is truly offering "something for nothing" but it's also wrong to lump them in the same boat as a spammy application that sucks people in only to hold them hostage for money later - especially since the stated mission of the company has the potential to do profound good.

Leonard's article is titled "How the Facebook Economy is Costing us Big."  He should have chosen a different example.  Yerdle is not a part of the "Facebook economy," it's part of the sharing economy - something altogether different which is definitely not costing us unless you're a disposable swag merchant. Rather, the sharing economy is very much reinventing things in ways that will be beneficial for people, planet, and profit.