At this time last year, the mobile app Clubhouse was at the peak of its popularity and ubiquity. Everyone was there, looking for invitation codes, dipping in and out of “rooms” and sharing what they had heard or done on their other social channels. Business icons like Elon Musk as well as other celebrities were dropping in, mixing with ordinary people and with that, the audio platform became the hottest place to meet. With COVID restrictions still in place, people were actively looking for a new way to meet and connect with new people and ecosystems.  According to recent data, at its peak on February 27, 2021, Clubhouse’s daily active users reached more than 4 million. By November 2021, that number had plummeted to around 940,000.

Today, just a year later, Clubhouse is rarely mentioned and is steadily losing users.

So what happened? How did such a popular platform suddenly…deflate?

Enter…The Drama Room

Part of Clubhouse’s initial appeal came from the ability to meet like-minded people. But over time, the interesting insights and discussions that were initially available in subject rooms became drowned out by divisive comments, rumours, and false promotions. Instead of the smart conversations with globally-active and impressively insightful individuals that had been initially promoted, Clubhouse chat rooms became more like “Drama Rooms”.

This tension and division erupt organically because much of Clubhouse’s room content is consciously curated to provoke controversial topics to attract audiences. Because Clubhouse does not have its own system to monitor and control contentious content – it is especially well-suited to wild claims and discussions that steadily erode audiences and trust.

Lack Of Quality Control

Once the novelty of the Clubhouse experience had passed, what remained was a more foggy and variable experience. Although users choose a room by subject and topic, the quality of the content is completely uncontrollable. Instead of the anticipated insightful discussions, the user experience was often similar to wandering around a large room listening to vague small-talk and killing time waiting to see what might happen or what might be said. Increasingly, the time required to make an interesting connection or to get to experience quality content is just not worth it — there are too many better alternatives.

Lack of A Game Plan

In many ways, Clubhouse’s initial and unexpected meteoric rise caught its leadership team off guard. Still early in its development, it didn’t systematically plan its own platform advantages and characteristics, and when the influx of people came — they weren’t actually ready for it. As a result, the platform has struggled to form deeper relationships and scale self-sustaining communities.  Clubhouse’s popularity came fast (everyone was talking about it!) and went fast when users realized there was no special content or connections that were of value.

Misunderstanding the Power (and Profits) of Platforms

Fundamentally, Clubhouse failed to grasp the role of a social platform, which is to create a plan and place for all the parties involved to connect, play, and profit. The analogy is to think of Clubhouse as a shopping mall. The purpose is not to produce a specific product — but to offer an experience and to pay attention to what products users are looking for and then tailor the offer to address that. This in turn shapes what products are displayed and how. For the business, this connection becomes the foundation for their profit. But Clubhouse failed to do this. The result is that Clubhouse lacks a clear path to profitability. Because Clubhouse doesn’t share user, creator, or room analytics, it has become a black box for advertisers, missing opportunities to sustainably profit at its peak.

Not Intuitive or Lucrative For Current Influencers

Clubhouse hoped to generate relevance and sign-ups by encouraging existing social media influencers to launch Clubhouse profiles. The challenge was that their skills don’t transfer. To be effective on Clubhouse (which required hosts and participants to communicate “live” with “audiences” on audio) is very different from creating content that works for TikTok, Facebook, Instagram, YouTube, or Twitter.

While anything is possible, the cycle that Clubhouse is in is not promising. Clubhouse seems to still be in the initial stage of providing a place for everyone to communicate. Without a sound profit model, quality content creators will not be attracted to the platform. Without quality creators, there will be no continuous good content. Without good content, users will continue to open and try the software, but not develop a relationship with it,  and so eventually everyone will leave. This is an interlocking chain of interests, allowing creators and thought leaders to make money is the key to the operation of the entire model. And currently, for Clubhouse to compete with the established players is likely to be exceedingly difficult. In North America, YouTube is the most friendly way to make money for influencers and creators and their advertising distribution system and billing model are already very mature.

To address this, Clubhouse has started to invest in its own influencers in the past year – but the whole operation process is very cumbersome and thus far, Clubhouse has not established its own “net influencer training mechanism”. Instead, so many talents have been lost to other social media platforms. If Clubhouse is to become a social media platform that gets attention again, the support and training of content and content creation talent is a necessary and urgent strategy.

This article is based on the “Turn Lemons Into Lemonade” podcast, a Chinese language podcast created by Hua Yu.