NewsCred Begins to Pay Members for Participation

Svetlana Gladkova,

on October 01, 2008,

We first covered the information consumption startup NewsCred when it launched in public beta back in August. NewsCred is intended to provide you with a customizable digital newspaper tailored to your taste and taking into account credibility of various news sources so that all the information a user receives could be trusted.

At the time of the beta launch I was particularly unhappy about one thing - NewsCred used the full RSS feed content from the sources to feature on its own site, thus failing to send people back to original stories when they were interested. Since then this problem has been fixed and the “Read more” link appeared for each item to send a visitor to the original article or post.

The only thing that I am still unhappy about is the somewhat elitist feeling on NewsCred where users are supposed to make the choice of the news sources out of the limited options available on the site (a little over 100 sources now). Without functionality to add news sources of your own if you find them more credible for yourself it did not sound like a correct approach but I do hope that with the speed that the guys add new features like commenting on items this problem will be acknowledged and addressed eventually. This will be surely appreciate both by users who will receive extra freedom and by smaller publishers who will still have a chance to appear on the site.

NewsCred leaderboard of top users Today NewsCred has introduced a small new functionality - Leaderboard. Unlike what we see on TechMeme where Leaderboard represents the top 100 news sources that the aggregator gets most stories from, NewsCred intends to use the Leaderboard to feature the most active community members instead.

This approach is quite logical: credibility of various news sources and authors is determined by users that can vote here adding credibility or taking it away. The aggregate votes determine credibility of all the sources here. So the Leaderboard introduced today is a place to showcase the most active users, where the level of activity is determined by karma that is earned by voting and commenting on stories. It is definitely worth a special mention that the most active user by the results of every month will be rewarded with $100 Amazon gift certificate.

After taking a look at the leaderboard as it is now it seems like the users are not particularly active on the site with only one user having karma at almost 200 points (takes either 200 votes or 100 comments on news items) while you will easily see people with only 6 karma points in the top 20 as well. While this clearly shows lack of activity on the site, it also shows how easy it will be for anyone interested to manipulate the service. Any user willing to earn $100 from NewsCred will just have to spend a few minutes per day on the site voting for various random stories and tracking performance of the closest competitors since the information on the leaderboard is publicly available.

Even if the prize may not seem to be particularly worth cheating, it could be not such a bad idea to be able to buy a few books on Amazon every month without spending a dime out of your own wallet. So chances are that the service will be manipulated all the time while it will hardly result in growth of natural activity around the news content.

Honestly, I already hate the word karma and I don’t think it is wise for any startup to make users do something on the service to earn any points whatsoever. It never seemed fair to me because normally people eagerly use what they see value in and simply ignore what they dislike or don’t feel valuable enough to justify the time to spend on this or that service. Introducing money into the scheme makes things even worse - we immediately understand that people can not be motivated into using the service out of their own free will and need some extra stimulation to participate.

Unfortunately I have not seen it help any startup yet and I think NewsCred will hardly benefit from this new promotion idea. Sure, various cash incentives and contests usually seem to be a clever marketing action but they rarely bring the desired results. Honestly, figuring out a better way to engage users may really be needed if the guys over at NewsCred see a problem with the engagement level.

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8 Comments (Subscribe to rss)

TM - October 01, 2008 at 08:33 am PDT

Wow, its a tough market out there. I’ve heard people complaining about having to participate in Web 2.0 services without any recognition or payments. The idea of micropayments has been floating around for a while. So these guys start recognizing their users and now that’s a bad thing?

I can’t say if it will work for all users, but I for one like the fact that they take the time to recognize their community. 100 bucks is a token, but if a loyal reader can buy a few good books with it, we should be commending NewsCred, not bashing it!
Shafqat - October 01, 2008 at 09:54 am PDT

Thanks for the coverage - just wanted to clarify. We just introduced the leaderboard a few days ago, so the numbers only reflect a short period. We have a very vibrant and active community, made up of thousands of voters. Our members take voting and commenting quite seriously, and there is high level of transparency (all votes and comments can be seen on any user’s profile page).

The whole idea of karma and the leaderboard was not a marketing ploy to engage users. The simple reason was to reach out to our community and highlight those that make NewsCred what is it. The whole reason thousands of people get to enjoy the benefits of NewsCred is because of each other. We’re thankful, that’s it.

Shafqat
CEO NewsCred
Svetlana Gladkova - October 01, 2008 at 10:02 am PDT

@TM: The only example of more or less decent example of compensating users for participation I know of is Newsvine and from what I’ve seen there people rarely are motivated with money to participate - it’s the community that matters. We here have away 3 iPhones to authors of guest blog posts that got the highest attention. I can tell you that it did not result in any single loyal reader. It is not a bad thing to recognize users but when a startup wants to recognize users they usually stick to inviting them to the blog, shooting short videos or something very similar. When users are invited to take part in any type of a contest that involves cash prizes, it certainly means that the company has its own goals to achieve - and usually it is to make users do something like invite other people or vote. The problem is that money does not buy loyal users, loyal users are only loyal because of the service itself, not because of the prizes it has to offer. Would you want me to compare Wikipedia to Knol maybe?
Svetlana Gladkova - October 01, 2008 at 10:07 am PDT

@Shafqat: I would really love to believe you but unfortunately I can’t. I have never in my life seen a startup luring people with cash when everything was fine, honestly. Usually it comes as a measure to fix some problems and while I now see the leaderboard should not have any higher numbers given it is only a few days old, I can hardly believe you only introduced the whole leaderboard/karma/cash idea to recognize your users. Honestly, in a news-focused community why do you need any competitive struggles between users at all? And by the way, I somehow feel it would have been a good idea to remove NewsCred staff from the leaderboard maybe?
Shafqat - October 01, 2008 at 10:15 am PDT

@Svetlana - we thought long and hard about omitting ourselves, but decided not to tamper with the results. Of course, we won’t be taking any prizes, but I’m a member of my community and I enjoy participating. So I’m proud to be amongst the rest of our users!

I’m not sure why you are skeptical that people can be good to others. I am thankful to my community in my offline life and I show it, so why can’t I do the same in my online life?

BTW, the prize is not cash. It’s a gift certificate, which we hope the winner will use to buy some interesting reads.
Svetlana Gladkova - October 01, 2008 at 10:22 am PDT

Shafqat: That’s an interesting decision, I thought you simply forgot to omit your own employees. Maybe it could be a good idea to show that you belong to the team at least so that the rest of the users knew who they compete with for the prizes.

I am not skeptical about people can be good to each other, that’s actually what I always try to find in various web 2.0 projects - but rarely find unfortunately. But the reason is simple: I am a marketing person myself and I know why such things are implemented. If you actually wanted to simply recognize the most active user of the month, what could be simple than featuring this user on your blog and sending a T-shirt - something that no one will consider to be a prize at all. Sorry, I know you want to make everyone believe it is just your peculiar way of thanking users and hopefully your users will believe you.

By the way, I don’t see much difference between cash rewards and cash equivalent on Amazon. And if the leaderboard was only launched a few days ago and only collects data on these few days (thus NewsCred seemed to have an inactive community to me), how comes you have top in 3 months in addition to monthly top and the user names seem to be different in the two lists? Just curious.
BlogReader - October 01, 2008 at 10:25 am PDT

I’m a big fan of Profy, but your headline is sensationalist, no?

I check out the site, and they give a gift certificate to one active community member a month. That is very different than what your headline “Newscred begins to pay members for participation” is implying to me!

Also, why are you so critical that these guys are introducing community features or giving prize to active community participants. Isn’t that what whole Web 2.0 movement is about?
Svetlana Gladkova - October 01, 2008 at 10:34 am PDT

@BlogReader: Thank you for being a big fan of Profy. I am sorry if the title sounded misleading to you, I definitely did not mean to. But to me it is actually what they offer: paying active users to keep the community vibrant.

And I think I have clearly stated that the only reason why I am so critical is that I know you can never buy users loyalty and commitment (with cash or prizes equally) and I hate it when startups choose to go the seemingly easy way when they have so many wonderful engagement tools in their disposal that simply requires full-time work of a community manager (which is definitely more expensive that $100 per month).

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