A series of events led me recently to decide to make a really big switch - from checking into Foursquare to checking into Gowalla. Yes, Gowalla DOES give you the ability to check in everywhere at once, but there are always switching costs involved in joining a new network. New profile, find your friends. Connect this and connect that. Then learn the new ins and outs. Oh...and in this case, download a new app for my Android. Not to mention that many of my favorite apps are connected into Foursquare (like Runkeeper). Either way, there are always switching costs. Always. Even when a product is new - like, um, Shwowp - it takes time to set everything up and learn a new behavior. And the higher the switching cost (do I need to give anything up for this switch? will it take a long time?), the less likely a person is to make it. I know this, not as a marketer, but as a customer (I've always been a customer first). The prize at the end of that journey (the time/effort put in) has got to outweigh the cost of the journey itself.
So, first let me tell you about my decision tree on the switch.
I've been a Foursquare loyalist since 2009 when I signed up for it right before SXSW. Signing up for Foursquare that year had a switching cost in itself. I used Twitter. Why did I need it? Now I'd have to check where my friends were and what they were doing in two places (mind you when Twitter started, I was loyal to Dodgeball, Dennis Crowley's initial geo-location app). I recall telling Dan Fost in an interview that year that I was 'yet to be convinced' by it. Boy did I miss the boat on that one (usually I'm pretty good at picking the winners).
So when Gowalla came along shortly afterwards, I had made my switch and didn't feel much like budging. I did what most early adopters do. I joined, claimed my 'missrogue' url and slapped up a profile pic. That was all you saw on Gowalla for the past 2 years. I had been there. Once.
Then a series of events fell into place that made me think about going back:
- I spoke at Canada E-Connect, a conference for the Canadian tourism industry. At the dinner the night before my keynote, the group of organizers were having a lively debate on the advantages of Gowalla over Foursquare. They had been incredibly impressed by the Biz Dev guy, who was very responsive and really focused on creating value for their city guides based on checkins. (my status: still unconvinced)
- The next day after my talk a very sharp dressed guy walked up to me to tell me how much he liked my talk. He happened to be the very same Biz Dev guy the group was impressed with. He introduced himself as Andy Ellwood. (my status: impressed with his style, willing to listen)
- I ended up going to Andy's panel on using geo-location for promoting tourism and really loved the way he described what they are doing, "A way to discover the world around you, share it with your friends, and have a record of places you've been. A Social Atlas/Digital Passport." (my status: impressed with his outlook, considering, but still too early to switch)
- Andy and I then became Twitter friends and went back and forth a bit here and there. I liked the way he thought about many things. (my status: liked Andy himself, and still considering switching, but not on the top of my priority list)
- Then I get an email from Foursquare at one of the busiest times of my life. I barely had the chance to scan it, but it went something like, "We've limited the number of friends you can have, so we, basically deleted all of your friends except for the first 100." I told a friend of mine who asked why I wasn't following him anymore that, "I was too busy to be annoyed at the moment by Foursquare's move, but I would take action once things died down." In basic terms, THEY REMOVED THE SWITCHING COST. I had a choice. I could go through my thousands of followers and find my friends and follow them again, or... (my status: It was time to make a decision...and I was annoyed, so it made the decision a little easier)
- Meanwhile, Andy contacts me to have a drink at SXSW and discuss a really wicked conversation we had on Twitter. Then he gives me the final nudge...mixed with an appropriate amount of guilt ended with a flirty emoticon, "http://gowalla.com/users/missrogue Looks like beginning of something awesome. =)". (my status: switching)
It was a perfect switch scenario. A personal relationship formed that made me tempted to switch - in spite of the costs - then the switching costs themselves disappeared. I most likely would have switched anyway. Andy won me over. I've known Dennis and Naveen for ages. Not on a deep buddy-buddy level, but I had a Shake Shack shake with Naveen a couple of years back and Dennis came to a book launch party that Brian Solis and I co-hosted when our books came out. Enough to say I had a closer relationship to them than anyone from Gowalla. I still really like Dennis and Naveen, so it's nothing personal to them. And the nice part of all of this is that I still get to 'use' Foursquare when I'm using Gowalla, so at the end of the day, I can be friends with everyone. ;)
Oh...and as an added bonus: When I complained like a princess on Twitter that I would have to sit and approve friend requests all night in this switch, Andy 'fixed' the issue in about 5 minutes. He gave me my very own 'approve all' button.
The lessons here for anyone running a startup, whether you are the market leader or not:
- Personal relationships reduce switching costs. They bring loyalty. And they matter more than anything else.
- Reduce all other switching costs. Technical (make it dead simple). Time (make it fast). Emotional (make it compelling). Etc. (ask yourself what the switching costs are for the people you want to have use your service over other ones - even if there aren't direct competitors - Gowalla is smart to integrate with everything else).
- And if you are the leader, don't take your lead for granted! Think logically about what you are changing for your users. You may be giving them the perfect OUT for making that change they have already considered. This doesn't mean you lock people in (that's an out in itself). It means that YOU SHOULDN'T GIVE THEM THE REASON TO LEAVE.
Off to give Gowalla a whirl. And looking forward to our drink, Andy!