Thinking of creating a social networking entertainment site - Think it would work?

Hi there, i am thinking of creating a social networking site that is similar to Lockerz.com, where members can come together, watch videos, answers questions, play games, buy items, win items, redeem items for points earned chat, upload images etc, trade in their own items in return for money and items.

The things what i would do differently, never do a prize redemption, this where lockerz was very unpopular with it's members.

What i would do:

Make sure that members always have the possibility of redeeming items.
Interact with members as much as possible
Really take in feedback and advice


Now, i was thinking of taking out a loan to fund this venture around £5000 ($8000) does anyone think this would be enough to create a site such as the things i wish to implement above?

For the shopping section, what i would do is implement a shopping section such as one from Shopify, this would save a hell load of money trying to get developers to create a shopping section.

Image upload - Use a already available script, and heavily modifiy it to make it unique, cool and interactive as possible.

Games section - Use a already available gaming script on the web, heavily modify it to integrate with the site/members accounts, so when they play games, at the end of each game they get points etc.

The only thing that may have to do is get someone to develop the videos section, so members watch videos and get points for doing so.

How would i make money and how to pay for members items?

Well i think for the first few months, there won't be hardly any income, but as members grow, more and more people hear about the site, spend more time on the site, i believe some decent amount of cash can be made, with the implemention of adsense/CPA networks etc/member donations...

For the items - simply buy bulk items such as usb sticks, headphones, custom and unique t-shirts items like that etc for that time being, once revenue comes in, get items such as games, and other electronic gadgets etc. Most people on the web simply love to earn free stuff, and i think it can really take off it everything is set up correctly and so.

I know this probably sounds ridiculous, but i am planning on giving it a shot soon, even if all goes horribly wrong. What does anyone else thinks? Do you think it would work?!

 

I think you're going to need a lot of more than £5000. I understand you'll be using some pre-made scripts to reduce development cost, but the main expense would be marketing and advertising. £5000 is like a fart in a windstorm. It isn't going to get you a lot of traffic in the long-run.

All the best to you though mate!

 

I'm not to worried about any sort of marketing and avertising cost, though it can help, i feel like the word will get out basically, and the site can become popular from that. If i am honest, i feel like im going to need atleast extra 10k, just for the items, i was looking at the site wholeshipping site dhgate.com and the items in bulk once you add a few things are quite expensive. I'm going to need atleast 30 - 60k items for members, that's one thing that will damage the site - memebers not able to get their items. Lockerz manage to cope with this because that had a multi million pounds investment, i don't.

I think before i go into this though, i will need to consider everything and make sure i've got enough for the items, this is the most i am worried about tbh.

 

I really feel the need to grab you by the shoulders, shake you, and shout "don't do it man"!

The business model is unclear and unrefined, the revenue streams you've identified simply won't cut if for you, it would take you literally years to make back the investment you put in.

Additionally, you'll really struggle to get a site of that complexity, made to the quality needed, for your budget. It's one thing loosing your savings, it's another thing taking on a debt to do this which will grow over time.

You need to simplify, simplify, simplify, get the core revenue model nailed (for example many sites like this are simply glorified affiliate stores, or tiered sytems, check out shopstyle uk for a good example, they made a huge affiliate store, then made a CPC affiliate program, so other people make sites and send them traffic on a CPC basis, and they make the commissions from the big brand end retailers).

Get the core business model sorted out, figure out the smallest site possible to implement, figure out a link bait / hook for users (if going down the social road), then get it built, *only* ever add on features when they improve the functionality/efficiency of the site, and only when it's glaringly obvious they are needed, or are requested heavily.

ps: I'm a UK web developer who's made 1000s of websites for clients, I've seen what's worked, what's failed, and who's in a huge mess because they were convinced their killer idea was worth getting in a huge financial mess for. If you need to talk things through more, pm me and we'll hook up via email or skype for a chat - the last thing I want to see is anybody else sinking that kind of personal money in to something that isn't 110% guaranteed to work.
Hope that helps a little,

Nathan

 

I don't believe in this project either - it just seems like too large of a mouthful. Do you really want to invest in items before you've even got traffic or even a site?

Also you have to make sure the points that members earn is equivalent to the profit you make.

 

very hard to get a foot in this market