Over the past decade, there has been a surge in the use of Internet-based social media platforms for maintaining connections. Nextdoor, launched in 2011, has capitalized on this trend but with distinctive operational methods. It relies on hyperlocal social networking as its foundation, forming a utility commerce platform characterized by trust and relevance — areas where many other social media companies have faced challenges. Nextdoor distinguishes itself through its adoption of a blockchain-style decentralized approach to local content creation, coupled with rigorous verification standards for platform access. These unique features position Nextdoor as a frontrunner to become the premier neighborhood-centric local commerce platform globally.
Growth & Engagement
While the last reported number of monthly active Nextdoor users was 27 million in 2019 (source: WSJ), its engagement has seen quite an uptick given this year’s COVID lockdowns. As of March 2020, 10% of American adults have reportedly been using Nextdoor actively (source: statista). The fallout of newspapers has created a vacuum when it comes to relaying localized news and Nextdoor is aptly positioned to fill that space and hence drive tremendous engagement in its platform on a day-to-day basis. If there is one key metric that Nextdoor should focus on, it should be Daily Active Users (DAU). DAUs would reflect an accurate picture of user engagement on the Nextdoor platform as it primarily serves localized news, local ads, etc.. which should make Nextdoor a natural part of everyone’s relevant daily routine, unlike the other social platforms which lack hyper localization depth.
Monetization
Nextdoor’s hyperlocal-everything model has come in handy when it comes to monetization using effective targeting & relevant marketing strategies. Nextdoor in a nutshell makes money selling advertising spaces in different channels where its users access its platform — web, mobile app & emails. Studies have shown that Nextdoor’s target audience makes it an super high effective platform for advertising (source), and it has leveraged those strengths to monetize on a couple of verticals such as local real estate & services (utility, restaurant, services, etc..). Nextdoor also faces tough competition as in many ways it competes with a whole lot of companies such as Yelp, Thumbtack, Craigslist, Facebook Marketplaces, OfferUp, Zillow, Redfin & Taskrabbit. Trust and relationships are two key aspects when it comes to the services industry in general and Nextdoor should build on its fundamentals to build additional commercial capabilities aggressively to grow further. Nextdoor should beef up its repository of data around it’s user’s behaviour, purchase patterns, travel preferences, social status, points of interest, point in time needs, etc.. to build meaningful solutions that could bridge the gap between local and macro environments.