WordPress.com Verticals and the Future

Over the past few weeks, we’ve seen a number of WordPress.com initiatives trying to touch on niche business segments. As happytables is fairly known within the community, some chatter came up when the most recent vertical relating to restaurants was released. I’d like to take this opportunity to clear some things up as well as discuss what lies ahead. I think this is an important discussion to have as many are either interested or curious on the topic of WordPress as SaaS.

Is happytables involved?

We were approached by Automattic earlier this year (2012) to see what possible opportunities existed. Tom, Joe and I went to the drawing board and in turn pitched the wordpress.com/restaurants concept in April ’12 (see the presentation deck here). We were open to ideas where recurring revenue was an option. The only opportunity available at the time was becoming a traditional premium theme partner, which given the nature of our solution didn’t make for a viable business case (certainly not a long term one, more interesting would have been the same partner model but with the recurring element). In other words, we would have seen a potential relationship structured in a more incentivized manner. Whilst we are still open to ideas, there currently is no business relationship between us. We’re happy to see our concept validated though.

Impact for happytables?

A big misconception is that we’re now some sort of “fierce” competitors, which couldn’t be further from the truth. Running a business targeted at a vertical comes with quite some baggage, 90% of which has absolutely nothing to do with WordPress. Whilst we are miles apart in execution and depth, I guess we expect some minor cannibalization given their existing reach and reputation in the overall “website builders” market (they did after all land a TechCrunch TV segment on day two). That said, we’re confident in our business and the foundation we’ve built both online and offline whilst being bootstrapped. With myself being the “face to the client” and evangelist for happytables, I’m grateful for the successes we’ve had to date in the areas where larger companies will find it hard to; developing a relationship with clients, understanding the challenges they face and trying to be part of their growth online.

This all leads up to the most important point. That is that we’re genuinely trying to help independent restaurants succeed as small businesses, it’s something that I believe in deeply, this sort of democratization of opportunity. Solutions such as Kiva or Kickstarter provide liquidity and tear down barriers to entry, enabling individuals or groups to overcome the initial hurdles of competing in spaces filled with larger players. It’s the same reason we have a free plan that allows you to connect your domain and doesn’t contain any 3rd party advertisements. This enables us to give a free website to restaurants just starting out, or those in less fortunate countries. Whilst we’re far from having perfected our revenue model, we feel good about what we’re doing and would like to think that we’re adding value to the web as opposed to polluting it further.

This is what motivates us and allows us to approach the problem from a different angle, thus adding value in completely different (and hopefully new) ways. Long story short, you can’t compare the dotcom vertical with happytables, not that easily.

Impact for other WordPress SaaS businesses?

So who has to worry? With these new verticals, Automattic will in my opinion continue eating away at profits generated by “web assemblers”. You’ve heard me use the term before. These are individuals that do not develop, but rather assemble hosting, theme, plugins and basic support to create and sell a “custom” website (in other words a large part of Theme Forest customers). If a WordPress SaaS platform was created as an extension of this mindset, then they won’t last long either. This is because there isn’t a great deal of creativity or specialization involved, it’s easy to replicate and scale. WordPress.com has established itself as the leader in that segment a long time ago and has turned this assembly into a seamless experience (especially with the frequent improvements to onboarding and user experience). That isn’t to say that there aren’t exceptions. If you sell and provide support in a language other then English or are physically present for your user base, you certainly have a unique advantage.

If on the other hand, you’re passionate about the industry you’re targeting and are genuinely interested in finding solutions that can help your customers grow and be more productive, then I believe you don’t have anything to worry about. Automattic is great at what it currently does and is quite amazing for only having a c .130 employees, but even they can’t be everywhere at once. Kudos to bringing Xzibit and others into the music vertical though.

Your thoughts?

I can imagine from the recent news post at WP Realm that there are quite a number of different views and ideas. Where do you think this is going and what sort of impact will it have?

  • Anton

    Come to think of the similarities between boybands – you can’t just start another one without going on tour and paying constant attention to your fans.

  • http://thebloghouse.com/ Andy Symonds

    Wow this had all passed me by but your offering looks great. Do you have a referral / affiliate programme?

  • http://twitter.com/dimensionmedia David Bisset

    I was wondering when you a blog post would show up in “response” to Automattic’s move yesterday (or was it a few days before)? Nevertheless, excellant thoughts and why one shouldn’t (or should be) be concerned about SaaS solutions based on WordPress.

    You mentioned hosting briefly – and forgive me if this is off topic – but what does HappyTables do as their hosting layer? I’ve always curious.

  • http://www.noeltock.com/ Noel

    Thanks for the comment! We’re using AWS, but not in multisite form, sep. db’s but a single repo :)

  • http://www.noeltock.com/ Noel

    We sure do! Here you go :) http://www.happytables.com/partners/

  • http://twitter.com/carlhancock Carl Hancock

    I don’t view Automattic’s vertical play as a threat to a true vertical solution such as Happy Tables at all. It’s much too simplistic to compete with a more robust solution and service.

    They’ll compete with the more advanced solutions like HappyTables only so much as WordPress.com competes with WordPress sites in general. It only serves the needs of the most basic customer and lacks both the depth of capabilities and industry expertise of a more focused and full featured solution.

    That isn’t to say they won’t be successful in having people sign up for sites across their various verticals, they will. The market is huge with all types of customers. So they will certainly get a lot of people to sign up for these sites just like they get a lot of people to sign up for WordPress.com blogs.

    It is a good way for them to “test the market” and see which verticals are the most popular and then expand upon those verticals in the future… but even if they do expand within a vertical that certainly doesn’t mean that Automattic would become the be-all and end-all for that vertical. Far from it.

    There is plenty of room in the marketplace for full service more advanced solutions such as HappyTables. Both now and in the future. Even if Automattic expands within that vertical.

  • http://twitter.com/dimensionmedia David Bisset

    Interesting… and thanks!

  • http://www.noeltock.com/ Noel

    Well said Carl, there’s been a lot of hype surrounding these verticals, but that certainly shouldn’t derail anyone with a serious business plan.

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