Lala.com
'la la' has a pretty simple business model: You register (a very simple process) and list all the CDs that you own and want to trade. The next step is to list the CDs that you actually want. They send you a kit consisting of prepaid covers and CD cases as soon as you list at least five CDs that you have to trade. 'la la' matches (from among the registered users) those who want CDs with those who have them. Once a match is made and you have a CD that another member wants, you will be notified of the match. You are not obligated to ship the CD but if you agree to and click on the 'Agree' button, you are shown the address to which you must ship the CD (in the pre-stamped — $0.63 stamp value — envelope and case that they have provided). 'la la' requests that you ship the CD promptly. And, if some member has a CD you want, they will do the same. 'la la' charges your credit card for every CD you receive (yes, you have to register your credit card); one dollar is charged for the CD and 49 cents for shipping, a total of $1.49 per CD received. You are not charged for CDs that you ship to other members. 'la la' makes it very clear that "...the number of CDs you receive will depend on how many CDs you ship to other members". And, yes, you own the CD that you receive. You paid for it, right? 'la la' promises to pass on to the artist 20% of the revenue made on each CD.
So, you dispose of the CDs you don't want and pay just $1.49 for each CD you want.
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3 comments:
A very smart business model!
They even have a contest with a prize of US$5,000 for those who can help them to shape the future of music.
Check this one out: http://www.lala.com/fwa
LaLa.com and Embracing Sharing
LaLa.com is just like eBay in two senses. First, LaLa.com enables a more efficient market by reducing transaction costs in ways not possible in the offline world. Second, people already had the ability to sell their CDs via eBay — LaLa just modifies the model.
And for what it’s worth: LaLa is giving 20% of its revenues to artists. That’s a better deal than they ever got from used record stores. What’s more, LaLa is reportedly losing money on every CD trade.
It’s planning to use CD trading as a loss leader to sell CDs and online downloads — that’s right: LaLa only survives if it helps artists sell more records.
Check out this article
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