When we were first starting to build the website at PROFITguide, I was a huge believer in giving content away for free. Not because I thought the content was valueless - but because there are so many free distractions on the Net that convincing people to pay for your information is just too hard. (It also raises the "what's my password again?" barrier, when you want no barriers at all to block people from maximizing their use of your site.)
Exceptions to Rick's Rule were always investment/personal finance content and, umm, "adult entertainment" sites - and I think both those theories have been borne out.
I don't think this is a forever situation. When rival content providers create an all-access pass that allows us to surf information and achives sites at a reasonable flat rate ($100 a year?), then consumers will agree to pay and producers can divvy up the pot based on where consumers spend their time.
Anyway, a fascinating story in today's LA Times underscores just how cheap consumers are when it comes to paying for content on the Web. Never mind that we're all shelling out $60 to $100 for cable TV every month; U.S. consumers refuse to pay 99 cents to watch instant reruns of favorite shows they may have missed.
CBS is scrapping its eight-month-old video-on-demand experiment with 99-cent downloads of such hit shows as "Survivor" and "CSI: Crime Scene Investigation." Instead, they are now offering these episodes free, sponsored by ads.
Said CBS exec Martin Franks: "We can make more money on advertising-supported downloads than we could on the 99-cent downloads."
Like any good entrepreneur, CBS tested different models this summer. Subscribers happily downloadedthese shows in test markets where GM paid the freight in return for ad placement.
"Viewers just didn't want to pay for it," a media analyst told the Times. "It's much easier to get money out of advertisers than out of consumers."
Next time you're trying to change consumer behaviour, keep this lesson in mind.
It sounds simple, but only sell only the things that people want to pay for. Find a different model for everything else.