Role Of Micropayments In Digital Publishing
Written by: Rashmi
The means of publication have become effortless in the digital age. Anything can be published within a matter of minutes, from short-form text to long-form interactive content. While publication is easy, publishers are still struggling for monetizing their content.
Subscription has already proven to be an effective monetization model for digital publishers. But not all publishers can rely solely on the subscription model. They have to find another model or additional revenue streams. In an attempt towards that, many publishers are turning to micropayments to find a reliable source of revenue.
Micropayments - A Brief Intro
Micropayments is not a new name for people in the publishing world. Publishers have been experimenting with the micropayment model for more than two decades now. Earlier, the tech was not advanced enough to support micropayments. But that has changed now.
Secure and reliable payment gateways are accessible to everyone. On top of that, it has become easier to track user activity without compromising their privacy.
So, the question arises – what is the role of micropayments in digital publishing in this day and age? Can it become the base of a reliable revenue model for digital publishers?
Why Consider Micropayments
Why try another revenue when there are other models? – this is a question often asked by digital publishers who have never tried micropayments. Down below are a few benefits of micropayments that make it a lucrative revenue strategy:
Add-on Revenue Stream:
A single revenue stream is generally enough for surviving but not for thriving. Having additional revenue streams always help in increasing the bottom line. So, digital publishers who are running on the subscription model can consider micropayments as an add-on revenue stream.
Unbundling Digital Content:
Not all readers are loyal ones who want to visit your app or website daily. Sometimes, they want to read just a single article or news piece. If publishers push readers to buy a full subscription package for a few articles, it creates a bad user experience which is detrimental to the business in the long run. If the readers get a good user experience with a few articles, they might get a full subscription later.
Leveraging Virality:
Every digital publisher wants virality. Even one viral piece can bring in hundreds of thousands of new readers. But virality means nothing if the viral piece of content is behind a paywall and the readers have to get a full subscription to consume that piece. Instead of keeping the vital content behind a hard paywall, digital publishers can accept micropayments and leverage virality.
A Solution For Subscription Fatigue:
Probably the biggest threat to the subscription model is subscription fatigue. Not only can it slow down revenue growth, but it can also become the reason for high churn. Again, micropayments can become a reliable alternative here. Readers who are affected by subscription fatigue are often willing to pay for individual pieces but not bundled content.
Disadvantages of Micropayments
The list of advantages of adopting micropayments is long but there are some potential disadvantages of micropayments that every digital publisher should be wary of. For example, its biggest disadvantage is the cannibalisation of paying readers. Readers who were otherwise ready to pay for a full subscription might reconsider their decision and choose to micro-pay and consume only a little content.
Another potential disadvantage of micropayment is the transaction fee. By definition, if a digital publisher accepts micropayments, it will get a high number of small amount payments. The high number will accrue a huge transaction fee. Some digital publishers are finding the solution to this problem by adopting the pre-paid and post-paid micropayments model.
The micropayments model comes with its own set of advantages and disadvantages. It is up to digital publishers whether they want to give it a try to generate extra revenue or stick to the more traditional options.
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