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Several people recently have been making the case against “micropayments”. I want to offer a counterpoint and a call-to-action. The opportunity is huge and it lies right in the media’s blind spot… @axate
https://www.cjr.org/opinion/dont-call-them-micropayments.php
[THREAD] 1/
https://www.cjr.org/opinion/dont-call-them-micropayments.php
[THREAD] 1/
The arguments I have seen recently make the case against an imagined system of 'micropayments', which will never emerge because it obviously won't work.
But there are more compelling ideas which produce better outcomes and are achievable. We should talk about them 2/
But there are more compelling ideas which produce better outcomes and are achievable. We should talk about them 2/
If you’re imagining micropayments as a small charge made every time you read something, let agree that they won’t work.
Why? Because they just punish consumers. The more they read, the more it costs them. “Save money by reading less” is a bad selling point. /3
Why? Because they just punish consumers. The more they read, the more it costs them. “Save money by reading less” is a bad selling point. /3
Lots of other reasons too, but no need to dwell on them. Instead, let’s focus what is usually missing from these arguments: what would be better.
Otherwise media is left with a choice of two models which don’t work well enough: advertising revenue or subscription revenue. 4/
Otherwise media is left with a choice of two models which don’t work well enough: advertising revenue or subscription revenue. 4/
Advertising tends to produce sites optimised for ad revenue – low cost, high volume, data-slurping and ad-heavy. As revenue falls, this gets worse.
Subscription tends to only “convert” a single digit percentage of the audience. That’s millions of people if you’re the NYT… 5/
Subscription tends to only “convert” a single digit percentage of the audience. That’s millions of people if you’re the NYT… 5/
…but only hundreds if you’re a small local newspaper. And in both cases you lock 90%+ out. Nobody has found the right way to optimise this. We need another way.
And it’s not “micropayments”. It needs to work for both publishers and consumers. What does that look like? 6/
And it’s not “micropayments”. It needs to work for both publishers and consumers. What does that look like? 6/
Start with the customer. How does their behaviour, on and off the internet, tell us about how they would prefer to interact with media?
Well… people like to move around freely. Most people read a variety of websites if they can, and share content with their networks. 7/
Well… people like to move around freely. Most people read a variety of websites if they can, and share content with their networks. 7/
Walls pose a problem for that behaviour.
Just because you want to read something today, you might not want to commit to pay for the same thing tomorrow. Multiple commitments even less. If you like two subscription titles, most will choose one (or none) & forego the other. 8/
Just because you want to read something today, you might not want to commit to pay for the same thing tomorrow. Multiple commitments even less. If you like two subscription titles, most will choose one (or none) & forego the other. 8/
But most of us don’t reject the idea of payment outright. We pay for some things online - if the price is right.
The problem for news is that the price is too high. This is one conclusion which leads to the simplistic “micropayment” thinking. 9/
The problem for news is that the price is too high. This is one conclusion which leads to the simplistic “micropayment” thinking. 9/
The most expensive part of a news subscription is the commitment, not the price. Per day, they’re really cheap. Much less than a coffee. If you could keep the price and drop the commitment, things would be different. 10/
“A-ha”, I hear the sceptics shout, “but the volume would never be enough to make up for the recurring revenue of a subscription”. But is that right?
Let consider to turn to the product itself – the news publication. What can be done to bring uncommitted readers back again? 11/
Let consider to turn to the product itself – the news publication. What can be done to bring uncommitted readers back again? 11/
For that, we have to start thinking of the product as a whole - not as "content".
Content changes every day but the product - if done well - stays the same. It delivers on readers' expectations, which have been created by the brand and consistent editing. 12/
Content changes every day but the product - if done well - stays the same. It delivers on readers' expectations, which have been created by the brand and consistent editing. 12/
If you want to see it done well, look at the best subscription newspapers. Freed of the tyranny of the ad marketplace driving their product, they focus on pleasing and meeting the needs of their customer – the reader. Delightful products, but closed to too many. /13
The work of selling access, when casual payment is possible, is much easier than selling subscription. Habit brings customers back, if they like your product enough. Habit, repeated frequently enough, can turn some casual readers into subscribers. 14/
Thinking about product, not content, also addresses another flaw with traditional concepts of micropayments, which is that it means “pay per article”.
The internet has made articles into micro-products. But we don’t have to capitulate to that. /15
The internet has made articles into micro-products. But we don’t have to capitulate to that. /15
We can’t prevent single articles being the default entry point, but we can encourage and reward readers who engage more deeply.
A system that charges you every time you read an article does the opposite: it punishes & discourages engagement, however low the price. 16/
A system that charges you every time you read an article does the opposite: it punishes & discourages engagement, however low the price. 16/
Another barrier the internet has thrown up is customer acquisition & ownership. It’s hostile to users and reduces their engagement.
Going through a new sign-up & payment process every time you encounter a new product is arduous and off-putting, even if the price is right. 17/
Going through a new sign-up & payment process every time you encounter a new product is arduous and off-putting, even if the price is right. 17/
Allowing customers to buy whatever they like, without having to sign up and check out multiple times, works better. And if media can find ways to share users without fear of losing subscription revenue or “ownership” of that user, the customer experience improves. 18/
Put simply, customers attracted to better products, and with fewer barriers, will end up spending more money. Better than that, media can find ways of encouraging consumers to move from product to product without being driven by a platform. Media can form its own network. 19/
So, to finish up... Anyone who critiques micropayments because they fail to solve the media’s problem, is right.
But anyone who concludes that the news media is forever left with a choice between advertising and subscription isn't thinking big enough. 20/
But anyone who concludes that the news media is forever left with a choice between advertising and subscription isn't thinking big enough. 20/
There is a opportunity for the media to turn around their revenue and products, and that opportunity lies between those two options.
By removing the barriers inherent in advertising, subscription AND micropayment models, publishers can develop a scalable network. 21/
By removing the barriers inherent in advertising, subscription AND micropayment models, publishers can develop a scalable network. 21/
By doing this, publishers can reduce dependence on big platforms for both traffic and ad revenue, and can develop better journeys and propositions themselves, all on terms they set. 22/
It means the market can be driven by the quality and success of products, by investment in attracting users and rewarding them when they form habits around products. /23
Some readers will still be subscribers, of course. Super-committed and super-served by the products they love. But the other 90%+ can still be customers too. 24/
Being able to charge the right price for your product is important. Solving the problem of low-priced transactions is a piece of the jigsaw.
But it’s a tiny piece - and it’s only useful in its role of enabling everything else. That is the real challenge and opportunity. 25/
But it’s a tiny piece - and it’s only useful in its role of enabling everything else. That is the real challenge and opportunity. 25/
To be clear, what I'm talking about isn't a fanciful idea. It's the thinking which led to me building a publisher and consumer-centric product to enable this network to develop. It's real, it works and it is ready to scale. It's called @axate 26/
It haz dozens of publishers and tens of thousands of users. Any publisher, whether free or subscription, can join and keep total control over their product, pricing and offer. It's a tool which addresses the huge opportunity between free and subscription. 27/
So let’s stop talking about "micropayments", stop imaginary insurmountable barriers preventing us thriving. Instead lets start talking about casual payments and removing barriers, start thinking about customers, networks and opportunities.[ENDS]
