TOKEN ADOPTION, STRATEGY AND ROADMAP
As of today, Friendz is a fast growing company in which companies can use FDZ token to purchase our services and app users can buy upgrades and features inside the app itself.
However, cryptocurrencies adoption is still slow and even the market discourages blockchain companies from using tokens, which still prefer using fiat payment.
To accelerate the token use and adoption, we decided to build a system to connect the in-app activities to fdz purchase and sale orders on exchange, allowing us to link our business to the real use of our token even when fiat currency payments are involved.
For the sake of clarity, credits are the currency that users gain in our circuits, while fdz is the currency spent in our circuits to purchase services, both from clients and users. By taking part in our activities, users gain credits which can be accumulated and spent in different ways: converted in fdz and, therefore, in app features or they can be converted into giftcards of partner companies in the marketplace section of our app.
In order to link the token to the business even in the case of services purchase through fiat currency, we structured a list of in-app activities which will trigger a purchase or a sale of a certain amount of fdz on exchange.
The triggering activities are the following:
1. Each time a user gains credits in app → a purchase order of fdz equal to the amount of the campaign’s credits will be sent out (in order to do that we will take the ETH realtime value on coinmarketcap).
2. Each time a user spends fdz in features/upgrades in the app, a sale order of fdz equal to a percentage of the amount in € of the upgrade value between 1% and 50% will be sent out. The unsold amount of fdz will be sent to our reserve.
3. Each time a user converts his credits in giftcards, a sale order of fdz of the same amount in € of the giftcard value will be sent out.
This automation will allow us to increase the volumes on the market, in proportion to the turnover rise and decrease the offer as the services bought by our community increase.
The objective is therefore twofold, on the one hand the expansion of products and services for companies, on the other hand towards end users.
CURRENT SITUATION
In the months following the ICO we took care of structuring the company. What may seem a trivial organizational process hides many pitfalls and should not be underestimated. The transformation speed of the organizational structure, thanks to the introduction of managerial roles, increasingly present and rigid procedures and processes, is one of the critical success factors for the company. The speed of change must be in line with the speed at which people within the organization adapt to the change itself, otherwise the risk of blocking the entire company becomes relevant. During the structuring phase we realized that our business model, as it had been thought, was not optimized to be scaled all over the world. It was the same as leaving for a long drive with a flat wheel. Continuing on that road would have exponentially raised scale-up costs and would not have allowed us to achieve the goals we set ourselves.
So we stopped to replace the tire.
The first problem we encountered was the difficulty and the time needed to integrate with a b2b market strongly based on relationships, as in advertising worldwide. Replicating what we have been able to create in Italy abroad involves much more effort and time, which, extended to many countries, made the business not very scalable in the short term.
In order to increase the scalability of the model, we tested different sales channels, concluding that it was necessary to build a Saas that would allow all potential customers, agencies or intermediaries to purchase our services independently, without the need to have a direct sales force in each country, as we have in Italy.
The second problem we encountered was the total dependence on Facebook and Instagram. These days having a business completely dependent on another company is a risk that is becoming too high.
In July 2018, as a result of the events of Cambridge Analytica, Facebook has reviewed several integration policies with third-party apps and in particular has taken away the possibility of publishing posts on behalf of our users on social media, worsening the User Experience of the our system.
We therefore needed to widen the typology of sold products and to have another environment in order not to find ourselves cut off from the market in case of problems deriving from these social networks.
The third problem was the technology used to write the application, now almost obsolete after four years and not suitable for global scale-up.
We have therefore rewritten the code of the entire application from scratch with one of the most modern programming languages, called React Native.
Another limit on growth that we have identified concerns the community of the application. The products we sell all involve activating and remunerating a community of people for activities that serve companies.
At the moment the app mainly sees the coexistence of two user targets that are difficult to satisfy in the same way.
On the one hand we have the “artistic” users, engaged thanks to creativity and gamification, who enjoy creating quality content and see the app as a source of challenges and fun. This target is much less affected by the economic component of the platform but ironically they are the most profitable target for our company, as these are the users that participate in branded campaigns.
On the other hand, we have a target passionate about savings, so the economic component is highly motivating for them. This target of users is on average less skilled in terms of content quality, but interested in all the other types of campaigns present in our app. This structure makes the model less scalable and does not find a perfect environment for neither of these two targets and their characteristics.
As for the last problem identified, acquiring a new user in this situation is very expensive and his/her permanence on the platform is put at risk by the lack of User Experience.
Therefore, we needed to understand and sort each of these aspects, before returning to international expansion.
PHASE 1. April ’18 — December ‘18
Structure, new app and diversification
In 2018 we focused on company structure, making the leap from startup to company with all the related advantages and difficulties.
A the same time, we entirely re-coded our app in a new language and we introduced new products to diversify Facebook risk.
PHASE 2. January ’19 — June ‘19
The Friendz Fork
Since two different targets currently coexist in the app, we needed to create two different environments and automatize the purchase of our services through SaaS. That’s why we decided to create the Friendz Fork.
The idea is to split the app, the community and the business model in order to create two different environments in which the two targets can grow in a more efficient way.
Friendz App
After the Fork, Friendz app will be related only to creative photo content and it aims to become a real social network for photos in competition with Instagram.
The introduction of the photo wall within the campaigns and the “Only Friendz” publication generates a further use of the app compared to the previous one as an intermediary between other social networks, giving more visibility and audience to the content of our users. The main advantage for users over Instagram will be the increase in organic interactions with their own content and the visibility obtainable within the community. This is due to the fact that the content published in Friendz are shown not only to their followers, but also to a target group of users interested in the same topic, a basic feature of the campaign system.
With the final introduction of the possibility of designing, creating and launching its own creative photo campaigns within the app, it will be possible to open multiple possibilities for the community scale-up, reducing user acquisition costs that slowed the growth down.
The use of the app as a true social network allows then to introduce a vast line of paid upgrades (in FDZ) related to the visibility of one’s own content and the management of one’s campaign, increasing the use of fdz within the application and the resulting demand of FDZ on the exchanges.
After the Fork, all of the non photo-related activities in app will be launched from a new web platform which replicates the Friendz mechanics: Atlantix.
During the Fork, a part of the Friendz community will move to Atlantix.
Atlantix
The “non-creative” Friendz users need a different environment where they can grow, have fun and make money. An environment where the savings component is fundamental.
The web version of Friendz, called Atlantix, actually allows us to solve several problems, first of all B2B scalability and the business’ further expansion.
In Atlantix companies can register their own public profile and, through a dashboard, create and launch activities on our communities, paying in fiat currency or FDZ. In case of activities payment in fiat currency, an automated FDZ purchase system will be applied, the same as for the campaigns launched from Friendz app.
For the community there will be further possibilities to earn, in addition to the already existing remunerated actions, thanks to the introduction of gift cards purchase not only through credits collection, but also with credit card, with consequent cashback in credits made available by partner companies. This functionality is not only an advantage for the community but a fundamental help in opening a new market. In fact, it allows us to create and grow a community in a new country before having the need to have customers, reducing part of the expansion costs.
PHASE 3. July ’19 — December ‘19
Validation
The validation phase will allow us to understand if the model is ready for the scale up phase.
The common goal for the 2 platforms is to achieve a sustainable cost of acquisition of a new user, which allows us to quickly expand the business in a new country.
For Atlantix, in addition to the user acquisition cost, it will be important to reach an adequate customer acquisition cost. In this period, we will validate the automatic purchase system of fdz on exchanges. After the system’s validation phase, as soon as volumes will require it, we will list FDZ token on big international exchanges.
Technological development necessary for this phase:
Friendz App
— Introduction of the campaign wall
— Introduction of “like” function
— Introduction of the possibility to launch campaigns in app
— Introduction of the possibility to send credits to Atlantix
— Introduction of new upgrades purchasable in FDZ
— Algorithm optimization for the organization of the contents in the feed
Atlantix (Public Beta)
— Company profile improvement
— Introduction of a gamification system based on groups
— Dashboard for launching cross-platform activities and monitoring performance
PHASE 4. January ’20 (only if the previous phase is completed)
Scale up
Once we will reach a sustainable growth cost as well as a completely replicable and scalable model, we will begin the international expansion starting from the main European nations such as UK, France and North Europe.
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