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Lightweight models and cost-effective scalability !

The final element in Tim O’Reilly’s web 2.0 patterns is “Lightweight models and cost-effective scalability”. Before web 2.0, companies need to create large scaled, complex, and costly websites with distributed computing that are difficult to manage and upgrade. Scalability in web 2.0 means making changes to cost efficiency, re-usability, processes and strategies in a business system, so that they can scale according to the size of the business. This makes for more flexible system management and makes it future-proof in sustaining business growth. Tim O’Reilly stated that scalability in web 2.0 can not only be applied to business models, but technology as well. Websites utilizing web 2.0 should be lightweight and cost-effective, as well as having the flexibility to scale up for larger operations. They should also have the ability to adapt to emerging technologies.

The benefits of Lightweight Models and Cost Effective Scalability include:
-Faster time to market
-Faster ROI through reduced cost and time
-Reduced risk of project and product failure
-Greater adaptability

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Gumtree is a great example of a lightweight, cost-effective and scalable web 2.0 model. The website was founded in March 2000 by Michael Pennington and Simon Crook, and was at first designed to connect people who had just arrived in a new area and needed help with accommodation, getting a job or meeting new people. As the number of users continued to grow as it gained more popularity, Gumtree created additional websites across the globe including Australia, New Zealand, Canada, and France. In May 2005, Gumtree was purchased by Kijiji, eBay’s internal classifieds group. It has continued to expand and now covers 60 cities across 6 countries.

Gumtree+website

Scale with demand – Started as a website that only catered for London users, Gumtree expanded its system as popularity increases so that it can handle the load of more users, and is now used in over 60 cities worldwide.

Syndicate business module – While starting out as a website only for accommodation finding or job hunting, Gumtree expanded its business services to include other advertisements such as electronics, furniture and etc. It also provided a forum for users to communicate and discuss products, as well as the ability to link ads to Facebook or Twitter.

Outsource whenever practical and possible – The community in Gumtree is already maintained by various buyers and sellers. However, Gumtree is still able to outsource its advertising services to different partners e.g. shopping.com, ebay and etc. to promote its advertisements. Gumtree also outsources its infrastructure to various cities to locally host Gumtree websites in order to strategically reduce costs and maintenance support.

Provide outsource infrastructure, function and expertise – As stated above, Gumtree provides outsource support for local hosts of Gumtree websites in various cities in a similar way as franchising. This provided Gumtree with new revenue opportunities as Gumtree websites are set up in new cities.

Scaling pricing and revenue module – Gumtree has an excellent advertising model, as it provides scaling advertisement prices for various users, from free advertisements to business rental rates.

To conclude, a business that follows this web 2.0 pattern is able to create and introduce its website to the market quickly, as well as utilize a lightweight module that is cost-effective and scalable to adapt to changes and new technologies. This allows businesses to achieve more with less, and is able to adapt to changes in the market rapidly.

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One comment on “Lightweight models and cost-effective scalability !

  1. Hi Leo

    It is fascinating to see a small website grow to be a big one. I think Gumtree did a good job in both handling more customers and expand their users base to another countries. They outsourcing a lot which is also a good thing.

    Prapat W.

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