Monetising the mobile user experience

MEX Manifesto no. 7 is all about the balance between monetisation and the purity of mobile user experience. How do we make products and services easier and more pleasureable to use, while at the same time deriving commercial benefit from these user experience enhancements?

The Manifesto statement reads: “We believe…mobile advertising is not the only way to monetise applications and services. A more sustainable revenue source can be found by identifying where and how customers perceive value, focusing on user experience and creating a revenue model which reflects the reality of user behaviour.” You can read the full version on the MEX web-site.

Priya Prakash, Head of Strategic Design, IconmobileWe asked Priya Prakash, Head of Strategic Design at Iconmobile, who will be giving a keynote presentation on this topic at the MEX conference on 19th – 20th May, to tell us a little bit more about the ideas she’ll be exploring in her talk.

Here’s what Priya told us:

Designers and product developers have traditionally been led to believe that the better and richer the user experience for a product or service, the more it has a positive impact on attracting new users, increasing usage and retention. But what if users don’t value the richer experience unless they pay for it?

If a richer experience is completely free, do all users need a ‘rich’ service experience even if they are in different levels of their service discovery cycle? Not really, as this can actually disorientate users who don’t need that depth of richness, as they are still early in their service discovery journey and haven’t fully engaged with all aspects.

So, how do we as product developers, craft services where users value the richer experience in a way where the basic experience is free, but to enhance the overall level of enjoyment of the ‘free’ version, they are willing to upgrade and pay to access premium parts of the service? Pricing plays a big part in helping users make that decision. Before purchase, when a user does the cost versus benefits analysis in their head, there is a big opportunity for product developers to leverage ‘ease of user experience’ where users can benefit from saving time and effort compared to using the same experience for free with more effort and hassle involved.

For example, iTunes pricing of individual tracks and the overall ease of use of buying a particular track in context of listening to your library, is seamless. If you compare this with the effort of going to Pirate Bay, Bit Torrent or similar services where one needs to hunt and locate the best source to download a particular movie or track, the experience involves more effort and time. The majority of users prefer to pay a nominal amount for an iTunes track, as it saves them from doing all the extra legwork with an added advantage of discovering tracks when listening to their library. In South Korea, Cyworld – a mobile social network with a user base of 15 million (one-fourth of the Korean population) – has elevated this to an art form. They have users hooked on games where users will pay for accessing more interactive features to enhance their basic (free) gaming experience.

Also pricing needs to reflect and fuel demand. Having scarcity when one has a digital virtual goods inventory is a paradox, but artificial scarcity creates desire and, again, if there is something limited, customers like to be part of the select few who either can experience it or even own it. Facebook’s gift shop also thrives on this idea of only having X number of a particular virtual goods left and displaying the tangible number below the gift item. In the physical world, Yo Sushi’s dynamic pricing that customers see changing everyday reflects the demand for particular dish, and adds positively to the overall customer experience as it creates transparency.

To craft the Fremium funnel (where most of the service is free but the user pays for value-added-services which in turn make their user experience richer), the initial experience of the service becomes even more important as it needs to be simple, but also show a snapshot of a richer experience by allowing the user to sample something small, which in turn enhances their experience and makes the service addictive. The free sampling incentivises the user to dip their toes further into the service, making discovery an enjoyable process, so when they upgrade, it seems natural in their journey. Again, making registration not a barrier to entry but a part of the discovery fuels the Freemium model. User details should only be needed when there is an exchange of some value to the user out of a particular interaction.

This was illustrated recently when Jared Spool’s UX company increased revenues of his client by USD 300 million dollars by changing the button from ‘Register’ to ‘Continue’ in the buying process, thus getting rid of abandoned shopping carts.

Engaging users in a way where they haven’t yet test-driven the service is another challenge for product developers working on Freemium models. Creating excitement and amusement while waiting to engage with the service, is key to get users to pay for the promised experience. Disney does this very well. When one goes to visit the Disney amusement park, the waiting in the queue is a pleasurable experience. It creates enjoyable anticipation and so when you walk through the doors, you really look forward to your first joy-ride. Showcasing potential flirts on the popular flirt wall to pique new users interest is one way Flirtomatic tries to get people to join the service.

So to sum up, if one is looking at monetising the customer experience, there are a couple of service frameworks that one needs to consider in the service design:

– Price v Ease of Use
– Convenience v Free
– Spectacle v Boring
– Expressways v Scenic discovery
– Sampling single experiences in succession v Showing all the bells and whistles of the service in one go
– Active listening v Passive engagement
– Scarcity v Limitless

Priya’s presentation on this topic will be given during the opening morning of the conference on 19th May 2009 and will be part of the collaborative environment where all MEX attendees play a role in responding to the agenda. You can take part in this think tank environment by registering to attend MEX.

Hopefully this article will get you thinking about the MEX Manifesto Statement No. 7 in advance of the MEX Conference. Please feel free to take part in the debate by adding your comments to the MEX blog below.

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