Creating marketplace trust through transparency and accountability

In a marketplace, trust between buyers and sellers is critical. Trust provides our Customers with confidence to buy services through Airtasker knowing that solutions will meet expectations. For our Taskers, trust lets them know that doing a good job will result in being paid fairly. So the more trust we can create in the Airtasker marketplace, the greater the opportunity we can provide for our Customers and our Taskers.

Now, let’s take a look at the two ways in which marketplaces can create trust (as always there are lots of ways in between too — but for the purpose of comparison and contrast let’s consider the two ends of the spectrum):

Centralised control

In a centralised control model, the marketplace itself establishes expectations with buyers and then oversees and implements controls to ensure that sellers comply with those expectations.

For example, Uber determines standards for vehicle quality, sets pricing and even maps the route that the driver will take from point A to to point B. Uber then implements controls and oversees everything to make sure that drivers meet these exact specifications.

In this model, buyers build trust with the marketplace and the marketplace implements a system to control the sellers.

Distributed trust

In a distributed trust model, the marketplace establishes a system that empowers individual sellers to set expectations with buyers and then incentivises those sellers to follow through and meet those expectations.

For example, eBay allows a seller to create a profile and a listing describing an item, price and delivery methods. eBay then provides a system (eg. communication, payment and reviews) that incentivises the seller to deliver on the expectations set out in their listing.

In this model, buyers build trust with individual sellers through a system provided by the marketplace.

To deliver on the Airtasker mission, we want to create as much opportunity as possible across the entire local services economy (remember: we’re a horizontal marketplace). So I believe that rather than trying to create trust by controlling specific outcomes in specific service verticals (which would be almost impossible to do across the infinite range of customer problems and service solutions that Airtasker enables) — it is much more powerful to distribute trust and empower members of our community to trust one another through a system of transparency and accountability.

But how do we create transparency and accountability in a marketplace in which it is our Taskers (who we empower, but do not control) who are delivering on a number of steps in the delivery of service? My view is that to create this transparency and accountability — it is critical that Airtasker facilitates end-to-end transactions. That is, Airtasker’s role is to provide a system that keeps a record of what happens at each step of the transaction — from connecting a customer with a Tasker who can get the job done, to facilitating payment and providing a system for feedback that helps Taskers build their reputation.

Let’s take a look at why it’s important to facilitate each of these critical steps to create transparency and accountability:

1. Connection — It’s critical that Airtasker keeps a record of which Tasker has been assigned to which task so we can make sure both the Customer and the Tasker have a clear and transparent understanding of what’s been agreed. Whilst it may seem obvious, for the purpose of providing a contrasting example: classifieds (eg. Gumtree, Craigslist) and lead-gen platforms (eg. Hipages, Thumbtack) don’t actually capture this information.
2. Payments — Providing a payment service is also a super important aspect of making sure that both parties are accountable for moving through each stage of delivering and paying for the agreed service. For example, once a task has been assigned (and payment is made into an Airtasker Pay escrow account), the Tasker can get to work knowing they’ll be paid once the job is done (or in the unhappy case of cancellation, the Customer is incentivised to let Airtasker know what happened to have their payment returned). Then, once the task has been completed, the Tasker is incentivised to return to Airtasker to request payment release and the Customer needs to return to Airtasker to confirm completion and provide feedback. In all cases, managing payment means Airtasker is able to keep a reliable record of what happened during each step of the transaction — which keeps both the Customer and the Tasker accountable.
3. Reputation — Feedback (eg. reviews and ratings) provides transparency over outcomes at the completion of each individual task which keeps Taskers accountable for quality service delivery. Over the long term, the cumulative sum of this feedback can be used to compute a reputation (a form of personal branding) for each Tasker — and because this reputation provides transparency that helps future potential Customers make better buying decisions, it is a powerful incentive to drive positive Tasker behaviour. On a side note, the cumulation of this reputation data also helps Airtasker build higher quality network effects which result in greater defensive moats — but more on that in a future post :)

So, wrapping this all up: it’s important that we facilitate end-to-end transactions to enable transparency and accountability as this allows us to create distributed trust… and building trust between our Customers and our Taskers is critical to building a marketplace that delivers on the Airtasker mission.