There’s always something to howl about.

Active Rain Says TANSTAAFL To Founding Members’ Uproar

The Active Rain Real Estate Network is charging a fee.  I’m not surprised.  The network has been trying to find ways to monetize its business since inception.  It tried a referral network and advertising and now it’s faced with the hard decision of pay-for-play.

Lani, at Agent Genius reported that one founding member deleted all of his content in protest:

This week, Active Rain inadvertently makes for heated conversation again by going back on their promise to founding members (the first users of the service) that they would never have to pay to participate because they evangelized for free and promoted the service making it what it is today.

Real estate blogger Jay Thompson, one of Active Rain’s original users and long time advocate of the brand noticed along with many other bloggers today that despite ActiveRain’s promise to grandfather in “founding members,” he was asked to pay an annual fee before he would be allowed to continue participating.

ActiveRain allegedly fudged notifying founding members and moved forward by only allowing active members to be grandfathered in. Thompson’s argument is not only one that he and others did not receive proper notification, but he and others comment frequently and despite being on a points based system tied to each user’s account, it is not considered to be “participation.”

Thompson’s response? He deleted all of the content he had ever written and I suspect he and others will no longer refer to ActiveRain in their frequent seminars, courses and speaking engagements.

I don’t know if I would have chosen to delete my content there.  Like any advertising model, it might have been useful to really analyze the costs and benefits.  I can think of three benefits to paying for membership in the network:

  • Back links to my home site– I can’t quantify what that benefit is but I know it helps my SEO
  • Traffic- I get some 200 visitors monthly from Active Rain URLs
  • Conversion- I receive 1-2 GOOD inquiries monthly, directly from the Active Rain contact forms.

This isn’t too hard to quantify.  The traffic alone is worth $200/year based on a price of only a dime per click.  The 15-20 good inquiries turn into 3-5 loans annually; that’s at least $10,000 in annual income to me.  I like to receive a 5-1 return on my advertising dollar so let’s say that’s worth $2,000 to me.    That’s more than the $29/month it costs to have an Active Rain account.

I don’t understand why everyone praises the value of “free” if free ain’t producing results.  Moreover, if you can trade $350, for $3500, isn’t that a good investment?