Overview of Threadless

Threadless organization is a community-based online platform that got started with $1000 by Nickell and DeHart in the year 2000. Inspired by their experience and motivated by their success, the founders launched their own business. Their website platform works like a never ending design competition. The organization allow community members to submit their design online which are then voted for by the community. Threadless company select the winning designs which they print and sell. The winner, in return get rewarded with cash for her own purchases. This business model has greatly contributed to its success.

Threadless’ model can get elaborated with the help of the building blocks featured in the Osterwald’s business model canvas as follows.

The organization Partners Customers, hosting providers and investors	Main activities Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper Managing product development process, platform development and maintenance	Value proposition Community feeling, get revenue shares of the final product	Customer relationship Acquiring customers through: Referral marketing, community	Customer segment Investors, entrepreneurs, marketers, developers.
Main resources Support staff, website operators, brand, user stock	Channels Community profiles, websites, emails
The cost structure Production on demand cost	The revenue stream The special preorder prices Subscription fees

In the year 2008, customers were mainly graphic designers, there were also consumers who buy the products. In 2018, there is a wide range of customers including software developers, consumers, designers, and webmasters to mention a few. According to the model, nearly all users share the same goal, a strong sense of identity, and enjoyment of task as well as a feeling of community belonging. When all users feel motivated to continue with the development of the platform, Threadless will be at a comfortable situation to disperse its shared risks.

Threadless has become one of the most innovative small organization in the United States. Its history dates back to the year 2000 when it was formed by two college dropouts namely Jeffrey Kalmikoff and Jake Nickell. Piller (2010, pp.47) tells the story of the Threadless starting with the episode at MIT meeting where the organization’s staff offered one of their first public presentations. The author has done a great job in documenting the history of Threadless organization since it got started.

From 2000 to 2004, the company’s revenue grew by 500 percent every year without any advertisement. However, by 2006, the Threadless user base grew up to 700,000 members and their sales reached over $18 million. The organization continued to grow in the year 2007 for an estimated thirty million dollars in T-shirts sales (Esnaashari, Azimzadeh, Farhoodi, and Solouki, 2018, pp. 144-149). By 2008, Threadless had gotten crowned several times, community members submitted various T-shirt designs online, which are afterward put into community vote and the winning design is selected. By 2009 the organization was well on its way to selling over one million t-shirts.

Currently, many people around the world know and embrace the organization as a company as well as an online community (Nelson, Mehta, Mikrut, and Shah, Caterpillar, 2012, pp. 13). The company has attracted over 1500 designs from over 42000 designers having over 80 million votes cast by the community to express their preference more than it did in the year 2008. This is attributed to the advanced technology that has led to an increase in e-business.

Business Model Canvas for Threadless

The crowd-sourcing business model has always been and is still the more successful business model for the Threadless Company.  This business model has gotten used for 18 years now by the organization. The company has been able to sell millions of shirts and still sell up to now. The Threadless designers are often asked to submit spectacular designs and they compete against each other doing the same thing (Lakhani, and Kanji 2008, pp. 608-707). It can be noted that there is a free argument which supports crowd-sourcing, however, the company already have a number of dynamics that make them stay above critiques as they build multi-billion dollars business a year.

Due to the fact that many crowd-sourced ideas begin with the need to build a community (Ghafele, Gibert, and DiGiammarino 2011, pp. 47). There must be a robust community in order to get the member submissions, also, there must be a good number of folks willing to submit their projects and get paid. The threadless organization started as a supportive community before they got into competitions. The mentality of making community first is evident today as one casual reading of comments will give provide a glimpse into how committed and loyal the community is to Threadless ideas.

A study by Brabham (2010, pp.1122-1145), through qualitative data of motivation of participants at Threadless. The author came up with four main motivators of participation at the organization which include: the opportunity of developing individual’s skills, the opportunity of making money, the love of community as well as the potential to take up freelance work.  

Threadless allow everyone in the community to submit his/her design through the community design platform. It allows the community to latter vote the designs and the best design is chosen and printed on the product sold by the organization. While the company solely focused on t-shirts at first, currently the product range also includes shoos, hoodies among others.  All of the designs are created and judged by the community, if a design win, the designer of the particular design gets a monetary reward of up to $5000.

Consumers are always very open in sharing their ideas concerning products and services as they will further benefit from them. As far as consumer involvement is concerned, a brand community can be compared with the OSS design community (Brabham 2010, pp.1122-1145). Through this, members the customers get motivated to participate in the organization’s business as they are driven by curiosity and enjoyment.

History of Threadless

The customers of the organization have shown great enthusiasm for the Threadless organization as they have made collaboration possible, they further protect the company from imitations and also contribute the ideas through which Threadless can be more productive and become better from what it is currently. The organization also have main roles in return; they focus their attention on their operations as well as further development of their communication platform through which they interact with their customers.

 In addition, Threadless also defines the rules of their game, manages all the process involving material delivery as they also honor the customer designers whose designs are used for production. By doing so, Threadless organization has been able to increase its productivity level with time.

According to the video, Kalmikoff, DeHart, and Nickell gathered in a conference room at the Threadless headquarters to discuss an offer from major retailers like the urban outfitters and the target. The offer was about selling the organization’s products in multiple retails stores across the country which was least expected. As a consequence, the organization had gained some advantages alongside disadvantages of the decision they made as displayed in the following table.

Pros	Cons
The individual artists could get acknowledged by their designs.	The organization lost the opportunity of increasing its revenue.
The designs can be purchased Threadless t-shirts at the same price as opposed to if the t-shirts were to be sold by the retailers.	The organization lost the opportunity for partnership with the urban outfitters.

One significant challenge that is faced by all retailers is to find a perfect blend of online and physical distribution channels. An organization like Threadless which has gained a considerable reputation in the digital world needs to consider making steps toward physical retail. Besides, how does the organization want to gain presence in physical retail?

I can be against the motion as Threadless has never had employees that staff its store and the organization has never used large staffing strategies as it does not have a design team. Also, the retail distribution is not consistent with the quirky and unique persona that the organization connotes since physical retail is always thought of being outdatedmarketing strategy (Serafin, 2012, pp.124-141; Leitner, and Grechenig 2008, p.21).

I can as well take side with the motion, the organization should have a series of traveling pop-ups in major urban areas across the country where it has a high customer base. This offers the beauty of having a physical retail (Kozinets, Hemetsberger, and Schau 2008, pp.339-354). Also, it will render Threadless organization the image of being hip and trendy. As such, I think the best idea would be to blend the physical as well as online retail.

A comparative analysis was conducted by Manzoor (2018 pp. 31-38) on the Threadless organization competitors. The process revealed the similarity and differences in the products and services offered by Threadless organization and its main competitors. The Design by Humans Company (designbyhumanscompany.com) is one of the organizations that use the same business model as Threadless organization. The organization shares the same characteristics as Threadless organization since, in the Design by Humans Company, artists also have the opportunity to show up their talented skills like in Threadless.

Growth of Threadless

Design by Humans Company also offer the same products and services as Threadless Company since its sales are primarily based on t-shirts. Like in Threadless, the winners in Design by Humans Company are chosen from the submitted designs and voted for by the site members and the most popular design get printed depending on the number of votes received. Additionally, both organization plays a significant role as they all focus their attention on their operations and develop their communication platform where they interact with their clients.

One thing that makes Design by Humans Company different from Threadless Company, however, is that the Design by Humans Company normally carry out innovative contests that motivate the designers, unlike Threadless. These contests include “shirts of the day,” “shirts of the week” and “shirts of the month” which rewards $750, $1000 and 1750 respectively. Also, in Design by Humans Company, designers have another possibility to get paid according to the number of t-shirts sold throughout the life of the design.

Conclusion

Based on the analysis, it can be concluded that Threadless is the company of the community, for the community and by the community. The community is the driver’s seat, submitting the designs, voting on the designs and buying the products, and even working at the organization. Because the community vote on the design, and decides which products are sold, and the community is the customer, every single product produced by Threadless will always sell out.

Reference list

Brabham, D.C., 2010, Moving the crowd at Threadless: Motivations for participation in a crowdsourcing application, Information, Communication & Society, 13(8), pp.1122-1145.

Esnaashari, M., Azimzadeh, M., Farhoodi, M., and Solouki, S., 2018, April, Webazma crowdsourcing platform. In 2018 4th International Conference on Web Research ICWR, pp. 144-149, IEEE.

Ghafele, R., Gibert, B. and DiGiammarino, P., 2011, Crowdsourcing patent application review to capitalize on innovation.

Kozinets, R.V., Hemetsberger, A., and Schau, H.J., 2008, The wisdom of consumer crowds: Collective innovation in the age of networked marketing, Journal of Macromarketing, 28(4), pp.339-354.

Lakhani, K.R. and Kanji, Z., 2008, Threadless: The business of community. Harvard Business School Multimedia/Video Case, pp.608-707.

Leitner, P. and Grechenig, T., 2008, Collaborative shopping networks: Sharing the wisdom of crowds in E-commerce environments, BLED 2008 Proceedings, p.21.

Manzoor, A., 2018, Using Social Media Marketing for Competitive Advantage, In Social Media Marketing: Breakthroughs in Research and Practice, pp. 21-38, IGI Global.

Nelson, B.E., Mehta, V.S., Mikrut, D.L., and Shah, K., Caterpillar Inc, 2012, Threadless quick connect tubular coupling release tool, U.S., pp. 12, Patent 8,336,856.

Piller, F., 2010, Open innovation with customers: crowdsourcing and co-creation at Threadless, pp. 6

Serafin, D., 2012, Defining Prosumption for Marketing: Understanding the Nature of Prosumption after the Emergence of Internet-based Social Media. International Journal of Management and Economics, (36), pp.124-141.

threadless.com, 2018, Accessed on 13^th September, 2018 from: < https://www./product/41/GiftCertificates >