I had the chance to attend the Financial Times Digital Media and Broadcasting Conference this week. What I brought back is that most of the communities out there are gonna die soon, unless they don’t take the micropayments red pill.
Micropayments have been around forever. While researching the topic I bumped into this report from 2000 by O’Reilly Media. In January 2009 the iPhone App Store passed the 500 million downloads mark . Microsoft and RIM (Blackberry manufacturer) announced they are following along the way.
Digital Goods & The Long Tail
Selling digital goods at small prices appears to be the waive of the future. As Seth Godin pointed out in his London Sessions, the long tail is where struggling industries such as Music or Print Media need to market their future.
Selling to the long tail means having a flexible product, which can be customized to the needs of very small groups of customers. Digital goods are the means to achieve such a tough end.
Some may argue that only certain products can be sold through these means. This is partially true as the the Facebook and iPhone applications phenomena have displayed how powerful applications could be to promote whatever product.
What does it mean for your community?
If you are bombarding users with intrusive advertising, you are out of the game. If you are charging Premium, you are gonna be out in few months.
Digital goods such as applications are revolutionary because they can be sold at a very low amount of money and are great advertising vehicles. In this instance advertising will be agreed with the person purchasing the app and it can be a great excuse to keep the costs to the end consumer low.
If you are starting now
Whether you already have a community in place or you are starting a new one, make sure you actually think about selling digital goods with micropayments as your prioritized monetization plan.
It may seem absurd now and if it does, the only relief will be the above O’Reilly article from 2000.