Challenge: an unsustainable business model
WooCommerce runs the official marketplace for WooCommerce extensions – essentially an app store for additional features that are too niche to be part of the core product.
The terms of the Marketplace included:
- A 50/50 revenue split with developers selling their products via the Marketplace
- WooCommerce handled all support and marketing for all products sold
- Developers were responsible for maintaining and updating extensions, but needed to go through WooCommerce to send updates out to customers
In early 2016, the leadership team at WooCommerce decided to close the Marketplace to new developers and products because this model became unsustainable – the team couldn’t keep up with marketing and supporting a catalog growing in complexity, and often a new product wasn’t worth the marketing and support burden.
Later that year, we started exploring what bringing new products to the Marketplace would look like. I was tasked with formulating a new model, defining product requirements and relaunching the Marketplace.
Solution: redefining the terms, focusing on a quality product experience
Working with the business intelligence team, we conducted a two-week sprint to identify the key changes we needed to make:
- We were taking on too much responsibility: We needed to shift responsibilities like support, marketing and deployments to developers, who were better positioned to serve these functions than our team
- We didn’t provide developers enough tools: In order for developers to take more ownership over their products, they needed tools to deploy updates, edit product pages, view revenue data, receive support inquiries and more. To do these tasks well, they needed guidelines, which at the time were not public and thus inaccessible.
- Our processes were invisible: Developers would often pitch products to us via personal emails to their contacts, which was silo-ed and not transparent. We hadn’t established standards for evaluating those products, so there were inconsistencies in how they were judged. Finally, because it was hidden in email, we didn’t have data about our rejection rate, common issues or how long it took from proposal to launch.
- Our infrastructure was clunky: The infrastructure that powered our Marketplace on WooCommerce.com hadn’t been reviewed in some time and wasn’t built to scale. For example, data about the owner of a product, including their name and payout terms, was stored on the individual product. As a result, when a developer changed their name, it needed to be changed on each product, by our team.
Over the next nine months, I led an initiative to resolve these challenges:
- Restructured the Developer Agreement terms: including updating revenue sharing terms to 60/40 and shifting marketing, support and deployment responsibilities to developers.
- Created a roadmap to update the product experience on our Marketplace, for both developers and our own team:
- New architecture built on Product Vendors (a WooCommerce-made extension for WooCommerce) created a ‘vendor’ taxonomy and solve many inconsistency and data problems.
- Product submission flow took product pitches out of email and into a structured place, where we could ensure consistent submissions, get data, and create processes for evaluations.
- Support routing meant support inquiries for developer products were routed, via email, to the developer’s own support tools, rather than to our support team.
- New developer dashboard, which let developers manage marketing copy and submit products for review
- Public documentation about how to write marketing copy, the terms of our marketplace and how to provide support
- Ran a beta testing program with top developers to validate new features, and then rolled out the new program to all developers.
At this point in the roadmap, I spoke at WooConf about our progress and goals.
Once the process was working well for existing developers, within four months, we opened up the Marketplace to new developers by:
- Creating a developer sign-up, where new developers could register
- Adding new reporting features to give insight into revenue, subscriber and refund numbers
- Launching a self-serve deployment flow, to let developers manage updates on their own
For the initial relaunch, we retain 97% of developers through the transition and decreased support burden on our teams by 15%.
Once we opened the marketplace to new submissions, we saw a 13% increase in our product catalog within 12-months.