I suggest a radically enhanced variation, FairPay, oriented to ongoing relationships, especially suited to online sales – that is sustainable and could solve the current crisis for digital content pricing.
FairPay combines Pay What You Want (PWYW) with consequences that make it fair to sellers by giving them a complementary level of control. It works where there is a subscription or other ongoing relationship of continuing sales, by tracking how fairly each individual buyer pays over a series of transactions.
Seller protection comes from their control over when to extend such offers. For buyers who pay fairly, the seller continues to extend more FairPay offers. Buyers who do not pay fairly must expect to lose the privilege of continuing to buy on a FairPay basis, and be left to pay a conventional set price for future purchases. FairPay can drive incentive programs in which those who pay well rise above the pay wall and gain increasing levels of preference and flexibility, and those who do not pay well drop down to reduced offers -- or a hard pay wall.
Because of this feedback cycle, this FairPay process can be very powerful for an ongoing series of sales. This is especially suited to digital products/services with their low marginal cost, for example:
--Any digital subscription service, such as newspapers, magazines, music, video, or services
--Individual digital items (or bundles) from a catalog of songs/albums, videos, books/chapters, articles, etc...
--Even for non-digital items, such as an ongoing series of movie previews (much like the Freakonomics PWYW movie preview)...
The process begins with one or a few low-value items (or a short subscription trial), to test how the buyer sets prices. If the prices are reasonable, a few more items (or subscription extension) are offered. As the buyer builds a reputation for pricing fairly, more FairPay credit is extended (but never so much that there is too much risk that the buyer is done and will pay nothing for a valuable bundle). So it might better be called Pay-What-You-Think-Fair, because that is the result.
FairPay retains the flexibility and participation PWYW offers to buyers, and improves on it by letting buyers set prices after receiving and using the product/services, after they know its value. This reduces pricing risk to both buyers and sellers. At the same time, FairPay feedback processes enforce clear penalties for unfairness.
FairPay also exploits price discrimination in a mutually beneficial way, to set prices that work for buyers with different price sensitivities and value perceptions. This expands the total market and increases revenues and profits.
FairPay enables sellers to go beyond freemium, to appeal to buyers with dynamically adaptive hybrids of free and paid service.
Details are at www.teleshuttle.com/FairPay. A blog with comments and specific examples is at www.FairPayZone.com.
Slashdot Mirror
FairPay combines Pay What You Want (PWYW) with consequences that make it fair to sellers by giving them a complementary level of control. It works where there is a subscription or other ongoing relationship of continuing sales, by tracking how fairly each individual buyer pays over a series of transactions.
Seller protection comes from their control over when to extend such offers. For buyers who pay fairly, the seller continues to extend more FairPay offers. Buyers who do not pay fairly must expect to lose the privilege of continuing to buy on a FairPay basis, and be left to pay a conventional set price for future purchases. FairPay can drive incentive programs in which those who pay well rise above the pay wall and gain increasing levels of preference and flexibility, and those who do not pay well drop down to reduced offers -- or a hard pay wall.
Because of this feedback cycle, this FairPay process can be very powerful for an ongoing series of sales. This is especially suited to digital products/services with their low marginal cost, for example:
--Any digital subscription service, such as newspapers, magazines, music, video, or services
--Individual digital items (or bundles) from a catalog of songs/albums, videos, books/chapters, articles, etc...
--Even for non-digital items, such as an ongoing series of movie previews (much like the Freakonomics PWYW movie preview)...
The process begins with one or a few low-value items (or a short subscription trial), to test how the buyer sets prices. If the prices are reasonable, a few more items (or subscription extension) are offered. As the buyer builds a reputation for pricing fairly, more FairPay credit is extended (but never so much that there is too much risk that the buyer is done and will pay nothing for a valuable bundle). So it might better be called Pay-What-You-Think-Fair, because that is the result.
FairPay retains the flexibility and participation PWYW offers to buyers, and improves on it by letting buyers set prices after receiving and using the product/services, after they know its value. This reduces pricing risk to both buyers and sellers. At the same time, FairPay feedback processes enforce clear penalties for unfairness.
FairPay also exploits price discrimination in a mutually beneficial way, to set prices that work for buyers with different price sensitivities and value perceptions. This expands the total market and increases revenues and profits.
FairPay enables sellers to go beyond freemium, to appeal to buyers with dynamically adaptive hybrids of free and paid service.
Details are at www.teleshuttle.com/FairPay. A blog with comments and specific examples is at www.FairPayZone.com.