Types and features of monetization

29 May 2018   |    Nikita Pazin   |   Business

Often the monetization of the project is built incorrectly, which leads to financial losses or the failure of the entire project. Let's see what monetization really is.

The basics of monetization

If you are not selling your product directly to your customer, then you need to develop a monetization concept. Monetization of a project is a long process that requires a long investment. Often, in addition to the concept, you need to test a number of hypotheses, one of which may be a repetition of the model of a very similar project. It is extremely important not to flirt with testing such hypotheses - this may alienate the audience, and it is better to conduct experiments on a small control group or segment.

If users do not understand that they pay for everything in one or another “currency", then you can not afford this luxury. I will explain exactly what I mean by a few examples.

Social network

Access to the service is free in the traditional sense. But is it really free? No. You pay with your data, your audience, and content, and often by viewing ads. This is a model in which the audience concentrates, self-segments, creates content and absorbs it, independently expanding the audience. The owner of such a network can sell access to this audience to advertising agencies, sell user data (at least in an impersonal form) to any organizations interested in them, or influence the audience's opinion using methods of ranking materials - making some more popular, and “putting others in the shade”. So, if you look at it objectively, many people underestimate their value for such resources.

Online game with a free account

It would seem, well, there can be no catch, unless, of course, we are talking about games developed for mobile devices - there are obvious options, or tolerate advertising or pay for the full version. But we are not talking about them, but for example about WorldOfTanks. Users with free accounts are needed for a variety of tasks: for a greater variety of behavior scenarios, as easier targets, which encourages players with paid accounts to renew them. And naturally, as a means of greater engagement and subsequent conversion.

Information project

Often, the core of such a project is a website, and the information published on it is transmitted to the social network and mobile app. In this case, depending on the value of the information and the audience's ability to pay, one of the monetization methods is chosen: subscription, or access to extended versions of materials, or selling the same advertising directly, native or in the form of branding (one of the most successful advertising strategies is chosen by Medusa). If a resource has not decided on one of these paths, it means that it is either at the stage of audience recruitment, or its task is to influence the audience in another way.

The combined project

Any professional community has a fairly good potential for monetization. Such communities either have separate social networks (for example, design, owned by Adobe), or groups in social networks. networks. For a specialized information publication, it is a logical step to create a group, form a community and broadcast the publication's publications in it. But many (for example do not take into account the " rules of the game” on the territory of social networks. What these rules are, let's look at a little more.

To determine the cost of such placement, they usually start from the cost of targeted advertising with the corresponding indicators or prices for ADS in the same social network. For example, a group of 10,000 subscribers will give a publication coverage of about 3,000 people. 300 clicks and 15 leads. Depending on the specifics of the project, the cost of the lead that the advertiser will be willing to pay will be about 1,000 rubles. in Other words, the adequate and competitive cost of an advertising publication should not exceed 15,000 rubles.

Image project

There are projects that are part of the PR strategy of the company, and at first glance only carry the image load (all the same Behance from Adobe). In such cases we see the company solve several problems:

  • Training the target audience
  • Focus your target audience to reach out to
  • Increase brand loyalty
  • Long-term conversions (i.e. conversions that are not performed on the site itself at the time of its use)
Alternative monetization models

There are resources, and sometimes independent authors who accept donations (voluntary transfers, often the term “donations” is inappropriate here, because monetization, although so selective, is embedded in the model of such a business). They can be quite effective, but not in all areas. For example, an author writing articles about saving homeless animals will raise funds, but an author writing articles about thermodynamic problems is unlikely.

How to build a monetization model

The monetization model is defined based on the main task and its parameters should be included in the project's KPI. Assume that the audience you have gathered is not slaves that you can " sell” to the advertiser, but the same participants in your business with their tasks and contribution to your business in their “currency”. Consider yourself as a Bank that makes millions of conversions from one " currency” to another, with each of them you earn a small percentage. This view will allow you to build a unique and at the same time effective monetization model in your project.

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