{"id":11208,"date":"2020-03-22T04:18:56","date_gmt":"2020-03-22T08:18:56","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-digit\/submission\/weddingwire-with-you-till-you-say-i-do\/"},"modified":"2020-03-22T04:18:56","modified_gmt":"2020-03-22T08:18:56","slug":"weddingwire-with-you-till-you-say-i-do","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-digit\/submission\/weddingwire-with-you-till-you-say-i-do\/","title":{"rendered":"WeddingWire: with you till you say I do!"},"content":{"rendered":"

\"\"<\/a>WeddingWire is a platform that connects engaged couples with wedding vendors to help them plan their wedding and streamline the process as much as possible. It was founded in 2007 by Timothy Chi who was frustrated by the complexity and opaqueness of the industry as he was planning his own wedding. Today, WeddingWire has managed to help millions of couples around the world and has added over 500,000 vendors to its online directory. It recently merged with another wedding marketplace \u201cThe Knot\u201d in a transaction worth $933M making it the largest wedding marketplace in the world. So, what makes WeddingWire so successful? How does it create and capture value? Finally, how sustainable is its competitive advantage?<\/p>\n

Creating and capturing value in a fragmented industry<\/h3>\n

There are basically two sides of this platform: the end customer planning their wedding and the vendors supplying services for the wedding (caterers, florists, venues, photographers etc.).<\/p>\n

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The end customers use the platform as a planning tool as they get access to an online directory of vendors with real customer reviews, a \u201cchecklist\u201d to track progress and to dos, budget tool, guest list tool, wedding inspirations, and a discussion forum to connect with other couples. As for the vendors, they use the platform to create their own “online storefront” on the marketplace, generate more leads, receive payments, gather customer data analytics (e.g. customer interests, storefront visits, leads generated), manage clients (basic CRM functions), and network with other vendors.<\/p>\n

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Vendor selection by end customer<\/figcaption><\/figure>\n
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Wedding checklist<\/figcaption><\/figure>\n
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Data analytics received by vendors<\/figcaption><\/figure>\n

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Vendor dashboard<\/figcaption><\/figure>\n

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The platform solves several pain points in the wedding industry creating value for both end customers and vendors.<\/p>\n

From the consumers’ side, it gives them access to vendors rated by thousands of users creating more transparency around the quality of service as well as the pricing which has always been opaque. This also gives couples many options for vendors to choose from saving them time and effort otherwise spent navigating the fragmented vendor industry and relying on word of mouth only. Moreover, the all in one free<\/strong> planning tool helps customers streamline a lot of the “required but not desired” tasks of wedding prep such as compiling the guest list eliminating a lot of the stress associated with wedding planning.<\/p>\n

As for vendors, the platform targets small businesses and lets them create their own online \u201cstorefront\u201d to showcase their services including pictures of their wedding portfolio and average pricing. This allows small mom and pop vendors to be found by customers who can now search and reach out to vendors directly. Another major pain point WeddingWire solves for vendors is the provision of customer analytics and basic CRM functions which small businesses do not have access to currently.<\/p>\n

To capture some of the value created, WeddingWire charges the vendors for the business it creates for them via its marketplace. It charges a subscription fee for running an online storefront and advertising on the marketplace. The higher the subscription tier the more exclusive the service is i.e. vendors would receive priority listing over others and are guaranteed first-page placement. Every vendor gets a customized quote based on its business category and size.<\/p>\n

WeddingWire, a happily ever after story?<\/h3>\n

WeddingWire has been very successful so far and was able to grow rapidly. Its strong competitive advantage could be attributed to three main pillars:<\/p>\n

    \n
  • First-mover advantage<\/strong>: one of the early entrants of the market allowing it to build a reputation in the industry and attract vendors who have little incentives to “multi-home” as they were already paying to be featured in a marketplace are getting sufficient traction from customers<\/li>\n
  • Understanding of customer needs<\/strong>: platform solves clear pain points\u00a0 and offers a customized experience no other competitor offered at the time<\/li>\n
  • Strong direct and indirect network effects:<\/strong> the more couples use WeddingWire, the more vendors would be interested to join and vice versa. We can also see same-side network effects as happy couples tell their friends about the platform and more vendors get their business partners on board (e.g. venue refers caterer to platform because they are used to working together). This makes its competitive advantage sustainable<\/li>\n<\/ul>\n

    The company’s differentiated business model and large scale makes it a strong leader in the market. However, it needs to account for many risks as it prepares to scale. For starters, its customers are all one-time customers since people plan their wedding once (ideally :). Hence, it should aim to decrease its customer acquisition cost. Moreover, the company might need to charge a commission on transactions to remain profitable which exposes it to disintermediation risk as the two sides of the platform get matched online but take their business offline.<\/p>\n

    It seems that WeddingWire’s story is a happily ever after one after all.<\/p>\n

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     <\/p>\n","protected":false},"excerpt":{"rendered":"

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