marketing, website, business-modelI have created a website that provides a service. The service is to allow people to post jobs in a specific niche market. I initially thought it must be free so that people will come.
I am curious if initially starting the website free and charging when traffic starts flowing in is a good idea?
In my experience you will lose a large amount of customers (or at this moment rather users) by charging them for your service from one day to the other.
The more common approach would be to expand your service by some additional helpful but paid tools/settings/functionalities etc. of which the user really benefits. These services may include for example an ad-free version of your site.
The other possible approach is to start in a free of charge beta phase. If you wish to pursue this option, it should be clearly communicated to the customers in advance.
Another option is charging micro-fees for content. None of this “99¢ for a month” – I’ve never once paid for one of those. But I would consider “5¢ for this article”, and I might be happy to pay a few nickels for a few articles of quality content (and come back again later in the week).
AFAIK, nobody’s really succeeded with the micro-transaction model yet, but there’s no intrinsic reason why it’s impossible. If you can ensure that your transaction costs stay percentage-based rather than transaction-based (e.g., you pay 3% of all transactions rather than a fixed fee per transaction), then you can adjust the price as low as you’d like to accommodate demand.
Coupled with advertising revenue, this could be a very viable model.
Good luck!
Adding on to Daniels answer, if you go the route of splitting your service into different tiers, you can grandfather your existing users into one of the tiers for free. This would help keep your existing customers happy and would allow you to make money off of new users. It would only work if you’re expecting to grow and providing service for your existing users isn’t too expensive.
People don’t like surprises. If you just spring the fact that users will need to pay isn’t going to bode well for your user base stats.
You can find the right answer to your question somewhere else.
Just go ask your users.
Send out an email blast to them and ask them:
Collate this information and figure out how you can use this feedback to generate a paid version product road map. Then go back to all those people that responded and pitch it to them for their feedback. You could even try being sneaky and take the thing the users love the most and move it into the base paid version with added value to justify charging for it.
Usually not. You basically stand to lose your traffic overnight when you flick the money switch. Avoiding this outcome requires that your audience sees enough value on your site and is loyal enough to stay around regardless of the fee.
See for instance how it happened in the news industry: for years on end, sites have been offering free content, and they ended up hostage to a situation they created. Their ability to set up a paywall is subjected to whether they’ve an audience that is loyal enough and that values their content enough.
At the very least communicate the idea it’s free only temporarily if you plan to go down that path. Also, explore other opportunities to monetize your traffic by providing services to end-users or job posters, by displaying ads, selling affiliate products or services, etc.
unclear communication with people in general, leads to problems. I think it is better to keep job posting free, and charge for adspace as an example. or any other service that you might develop in the future.
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