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[CDPS] G2 - (PR) Chapter6 - Monetization Member: Sunny / Cindy / M.J /…
[CDPS] G2 - (PR) Chapter6 - Monetization
Member: Sunny / Cindy / M.J / Phoebe / Ian
1.The challenge of monetizing
Partially free pricing and also power growth
Business strategy
Freemium
Pay the fee for an enhanced version
Dropbox
MailChimp
Offer one side users for
free
or
subsidized pricing
another side pay
full price
Fully control the network value create
Free products , lower price
How to serve :question:
Analysis the value that platform create
Charge the value that platform technology create for users
Four categories :pencil2:
2.For producers or third-party providers
Access the
ways
to community or market
Contact to global travelers
3.For both customers and producers
Acquire the tools or service to increase
interactions
Ex: kickstarter , ebay
1.For customers
Access to
value
created from the platform
EX: YouTube , Android , Skillshare
4.For both consumers and producers
Access to
curation mechanisms
for interactions quality enhancement
Consumers
High quality goods & services
(Needs & interests)
Producers
Consumers
( Willingness of their offerings & payment of a fair price)
Curation systems- right consumers ➡️ producers
Sources of excess value
3.Whom should you charge?
2.One side while subsidize another
i. Subsidize
Ladies' Nights
Dating Websites
ii. Incentivize
Most users full ptice while subsidize stars
Super-users
Malls
Skillshare & Indiego
Microsoft
4.Some full while subsidize price-sensitive
Discount/subsidize (price-sensitive)
Denver
Prediction is difficult
Boston
All users
i. Discourage participation
ii. Enhance network effects also
Carbon NYC
2.How to create value without reducing positive network effect？
Number of visitors not necessarily reflect the monetary value of platform
Ways to monetize
Charging for access
Charging producers
(Access for users' communities)
Sustainable monetization model
Enhance core interaction
Generate community value
Strengthen network effects
Case
LinkedIn
Dribble (Advertising)
Charging for access to community:
Recruitment/Employment listing
Charging for enhanced access
Producers're charged for access of unique tools
Extra value
Yelp
Google search
Care ✅
(Negative network effects ❌)
A paid access program content:
Avoid native advertising
Organic content
Avoid creating a users impression of restricted activity on platform
Usual curation principles should be applied to enhanced access channel
Users're charged for lowering barriers
Dating websites
Charging transaction fee
Merits
A powerful way to monetize the value created by platform
Without negative impact to network effects
Challenges
A fair percentage of value created:
Maximize profit however not discourage transaction
Leave the interactions on the platform:
Especially for platform which match supply and demand sides
Ways to solve
Provide all
information/tools/services
needed on transaction
Remove frictions / Reduce risks / Facilitate interaction
Reduce necessity of direct interaction between both side of users
Users avoid transaction fee by dealing off-platform
By
A percentage of transaction price
A fixed fee per transaction
Easier to administer
More appealing when
Expected high frequency of transaction
No significant difference of transaction size
Can be applied on transaction involve exchange of money
Charging for enhanced curation
High- quality is important
Pay the fee in order to get guaranteed quality
SitterCity
Filter the babysitters's quality
Skillshare
Transaction-fee-only ➡️ Subscription charge (enhanced value)
Decline of users sometimes increase the profitability of platform:
Reduce negative network effects
Encourage desirable interaction and discourage undesirable ones
4.Free to Fee
Rules
Users first , monetization later
Avoid reducing access to value that users have become accustomed to receiving
If platform reduce it
Avoid charging for value which users received for free previously
If platform charge it
Create new , additional value to justify the charge
If platform charge it
Control and guarantee the quality
Consider potential monetization strategies when making initial platform design choices
Transaction fee
Ensure the platform can control transactions
Access to their user base
Control
Avenue through which content reaches the users
The flow of data about users
Ignore the rules :eyes:
Goodbye , myspace :wave::skin-tone-2:
Users :silhouettes:
The services are good ! :smiley:
Charge the fee :money_with_wings:
F**k :angry:
The services are good ! :smiley:
No more good services :wave:
Facebook :
I'm still working~ :stuck_out_tongue:
F**k :angry:
Create and exchange value
Both sides are satisfied
Platform capture part of value
