EcommerceBytes-Update, Number 283 - March 20, 2011 - ISSN 1528-6703     4 of 7

Addoway Builds Trust in Ecommerce with Social Connections

By Greg Holden

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How do you build trust in ecommerce? A few years ago, trust came through features like eBay's famous (or, some might say, infamous) feedback system. But that system had as many flaws as assets. These days, there are plenty of ways to use word-of-mouth to build trust between buyers and sellers. People are doing it all the time on Twitter, Facebook, LinkedIn, and other social media sites.

Frederick Nijm and his partner Andrew Saia are using social media to build trust in a marketplace they launched in 2010 called Addoway. The name itself hints at their approach. As Nijm explains, Addo is latin for "to inspire" or "to change," and Addoway means nothing less than a new way of buying and selling online.

"Our goal is to solve the problem of trust online and to solve the feedback model. More and more people will be building relationships online," he says. "It's not just the best friend you went to high school with, but friends you meet over the phone. What if I know 26 people who are buying from someone who is selling bicycles? I will ask my friend who this person is, and now I have trust in that seller."

Connecting with Friends via Facebook
A number of marketplaces are incorporating connections to Facebook and other social media venues into their own websites or to the storefronts they allow their sellers to construct. But Addoway goes a few steps further. The site allows you to see what your social media "friends" have bought or sold on the site. It's all part of the effort to build trust through social media connections and contacts, Nijm says.

"We are archiving all the purchases made on Addoway, so you can see, for instance, six of my friends bought something from this person," he explains. "There are different levels of friends, just like there are different levels of love. It's not just your personal buddies, it's people you connect with online."

Nijm says problems with eBay's feedback and dispute resolution systems spurred him to look for a different way. He and Saia partnered several years ago to create Addoway (Nijm, 31, has a masters degree in sales and marketing, and Saia, 30, is a programmer). From headquarters in Phoenix and San Francisco, they've watched Addoway grow exponentially using the very feature they've integrated into their storefronts: word of mouth.

"This month was our biggest month yet. We're getting over 100,000 visitors a month. We've grown by a factor of four in the last three months," he says.

Nijm won't give exact numbers on the number of sellers on his site, but he says the site has "thousands and thousands of sellers," and that Addoway is approaching one million items being offered for sale. While most are mom-and-pop sellers making a "couple of thousand" dollars in sale per year, it ranges from sellers making between $20 to $50,000 per year in sales. One seller has topped a million in sales since Addoway went live in April of 2010.

Addoway Storefronts
Addoway currently has two storefront tiers: a free account, and a Pro Member account that costs $8.95 per month or $75 per year. To date, the site has not charged any listing or sales fees. Pro Members get access to a variety of features, including Google Analytics, display ads, the ability to display testimonials on their store's home page, and more. In about nine months, however, Addoway plans to start charging transaction fees that, Nijm says, will be "substantially lower than those charged by eBay and other sites."

Addoway Pro Member storefronts sport some unusual features, such as the ability to display video clips in which sellers greet visitors; testimonials from satisfied customers; and the Facebook transaction feature in which you can see exactly what your Facebook friends have bought on the site. Nijm acknowledges that, because the site has been online for less than a year, the chances of you actually seeing some of your own friends right now is low, but he expects the user numbers to continue their rapid growth.

Pro Member subscribers even have the ability to advertise what they're selling on other sites, such as eBay, eCrater and Bonanzle.

"We want people to build a brand, and grow their businesses with social media," he says. "We want to become a hub."

Nijm is finding the rapid growth of social media and of Addoway exciting and energizing. "I don't want to go to sleep since we have started this," he says. "Just watching people sell, test the site, and send emails thanking me, it's an incredible feeling to see these little businesses start succeeding in a new space. It's fun talking to people all day long. It's an incredible high."

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About the author:

Greg Holden is EcommerceBytes Contributing Editor. He is a journalist and the author of many books, including "Starting an Online Business For Dummies," "Go Google: 20 Ways to Reach More Customers and Build Revenue with Google Business Tools," and several books about eBay, including "How to Do Everything with Your eBay Business," second edition, and "Secrets of the eBay Millionaires," both published by Osborne-McGraw Hill. Find out more on Greg's website, which includes his blog, a list of his books, and his fiction and biographical writing.

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