Deciding what business model SoberRoad will utilise has been a hard task. For it to be a successful product it obviously can’t be free, but on the other hand, Can a price to put on better health? Looking at some of my competitors in this market, most of them are free with premium options that cost anywhere from £5-10. This is a tried and true method that has seen success across multiple apps and markets. But when looking at some of the reviews of these competitor apps, I noticed that one of the biggest complaints was the paywall that most felt was in the way of fully utilising the app. So I needed to devise a way for people to pay for the app in a way that didn't feel like they were getting ripped off in some way. And after some research in different business models, I think I’ve found the perfect fit.
Pay what you want is pretty self-descriptive. The consumer decides how much value that a product has to them and decides a price based on that. This business model has been used by the likes of Wikipedia and Adblocker to great success.
Set prices can alienate certain customers who don’t agree on the value of a product. For example, if a jumper was set at £30 then you would get some sales based on that price. But the seller of the jumper wold lose out in two ways.
PWYW removes this problem by letting those two audiences pay the desired amount. This is known as Price Discrimination and it is one of the key principles that allow PWYW to work.
There are methods for achieving a more profit with PWYW.
Obviously if given the choice between paying £0 or £5 for a product, most people would go for the free option. Right? Well that isn't always the case. Research has show that the average consumer is likely to put a price to something even if the option for a free product is available. This has to do with how we perceive ourselves and how we want others to do so as-well. If we use a product that we know has been produced for a cost, then we would feel unreasonable to use it for free.
It’s also worth noting that a company that has a better relationship with its audience will have more luck with a PWYW model. If the consumer likes the product and doesn't want it to go out of business, they will give more to make sure it stays a-float. So building a strong a loyal audience is a key point for this to be successful.
Obviously SoberRoad cold just ask the user if how much they want to pay during the On-Boarding Process; but I think their is much more organic way to implement this Business Model. One of the core features of SoberRoad is the ability to save the money the user would normally spend on their substance by having the app take it out of their account and into a savings account that can only be accessed after a set amount of time. My idea is to ask the user to give a portion of their choosing, of this saving as payment for the app. So for example, say the user puts away £8 a week and they give 10% of that amount. Then all together they are paying roughly £3.20 for the service. This will allow the user to set a value for the app while also feeling like they aren't actually paying for it.
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