Saturday, May 19, 2007

Lessons from YouTube's success

I recently watched a video by Jawed Karim, the 3rd co-founder of YouTube. The video is called "YouTube: From concept to hypergrowth."

In the video, Jawed discusses his observations on why YouTube was successful. Some key points from the presentation are below.

There have been a handful of disruptive web2.0 applications over the years:

  • LiveJournal (1999): allowed easy use/creation of blogs
  • Hot or Not (2000): anyone can upload or download user-generated photo content; matched take-off of digital cameras.
  • Wikipedia (2001): large-scale social collaboration can achieve order. People are willing to donate their free time
  • Friendster (2003): not the first social network, but the first one to catch on. Not based on email addresses, so better. It commoditized social networking.
  • (2003): Remote bookmarking, so you can access them from different computers. Popularized concept of tagging
  • Flickr (2004): Combined and photo sharing into a new product; before this, people shared photos within private networks; Flickr enabled people to share in public, using tags to search

When YouTube was started in early 2005, it was very difficult to watch, share, and discover videos on the Internet. The state of video viewing in 2004 was you went to a directory that listed a bunch of video files. You had no description or thumbnail for each one of those videos. You didn't know how these videos related to other videos. There was no way for people to connect over these videos. When you tried to download a video, you were forced to wait (buffering...) or had to download codecs, many of which didn't work for you. You couldn't see what was in the video until you downloaded it and started watching it. In other words, a very difficult experience.

So how did the site grow? When it was first launched in April 2005, nobody uploaded videos other than the founding team. They tried to email all their friends and get them to use it (which was the only marketing that HotorNot ever did). That didn't work. They put up a posting on Craiglist in LA to get cute girls to upload videos of themselves. They offered $100 to any cute girl that would upload 10 videos. That didn't work. They wrote to a bunch of reporters from Wired magazine asking for coverage. That didn't work. So what did they do?

They decided to revamp the site. They added a bunch of features to enable the product to promote itself.

1. Related videos: encouraged users to explore more videos on the site. Once they found a clip they liked, they could watch additional related clips

2. Easy sharing: made it extremely simple for users, with one click, to share videos with their friends. That way, their friends wouldn't get spammed by YouTube, but by their friends themselves.

3. Encouraged users' social interaction: find other users' favorites

4. Added external video player: allowed anyone to put a video on their site. This was probably the most popular feature. It extended YouTube's reach beyond its own site. Most notably, on MySpace.

The YouTube team noticed that every 2 weeks, there would be a "blockbuster" video that would drive a lot of traffic (thru sharing and WOM) to the site. As the usage grew, the frequency of these "blockbusters" increased to the point where it became multiple hits a day.

Another important lesson: YouTube let the community drive the site. They couldn't anticipate everything that the community wanted to do with the site. But they responded. For example, they created a feature that allowed people to post video responses (rather than just text comments) to videos.

Finally, they rewarded the users that made their project possible (similar to Threadless). They gave away an iPod every day in Nov. 2005 in order to stimulate video uploads.

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