Network Effect

What Creates Network Effect
The Network Effect
Linear Explanation
User Value in the Value Chain
Merchant Value in the Value Chain

What Creates Network Effect
Network Effect is achieved when frequent value is created for all parties. Frequent value, while a relative term, for us means that users and merchants are always actively looking for reasons to use Honey.

The Network Effect
Network Effect has a “chicken and the egg” problem associated with it. In our case some would ask, which comes first users or merchants. Well the truth is neither comes first, they are both built at the same time.

Linear Explanation
To get users, it means that we need to get deals, to get deals we need to get merchants - giving free payments gets merchants, saving merchants money enables them to spend more on customer acquisition, increased customer acquisition means more deals. This is how Network Effect works.

User Value in the Value Chain
Snacking on Deals: The idea is to create Honey snacking opportunities by creating more deals for the user. Each time a user uses Honey at their favorite merchant, they open up the opportunity to get deals/communication from that merchant. This means they control who they get deals from. On the flip side, they can use Honey to find new places in new areas by turning on the “discover” button. This will enable the to learn about deals that are close by.

User P2P: Unique P2P protects and shields a user’s Personal Identifiable Information from other user’s when they exchange money - see our P2P section. The Handshake has a viral cool factor that we think will aid Honey in going viral.

Decision Making: We help users make decisions on where to each meals and where to buy products and services.

Merchant Value in the Value Chain
Every time a merchant takes Honey as a form of payment, the merchant acquires the right to market to that user. Free transactions = more deals. More deals = more revenue generation. We thin the merchant value stands on it’s own.

Bottom Line: Users look for opportunities to get more deals, and merchants look to save money, earn money and get access to more of their customers and prospects.

Next Section: Acquisition Strategy

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