LOS ANGELES — The shift in consumer preference from premium adult paysites to ad-supported free porn sites, typified by so-called video tube sites and other publishing platforms, has presented many challenges for site operators seeking a profit and has spurred a variety of business models along the way.
These monetization methods span the gamut from costly ultra-premium offers for carnal connoisseurs, through a range of “freemium,” deeply discounted and downright free payment pitches, with one-time and recurring billing options, as well as numerous payment types from credit cards to cryptocurrencies and more thrown into the mix.
Economics and enlightenment also play a role, with free being a tough price to beat and younger tech-savvy audiences showing a disdain for paying for any form of digital media — and porn in particular — although some sites have hit a sweet spot by offering in-demand content on-demand and at attractive price points in the sub-$20 per month range.
While many adult sites have prospered with price points in the $14.95 to $19.95 range, early attempts at “blowout” discounted pricing around $9.95 often resulted in literally lackluster products that paled in comparison to some of the free offers.
Now, free porn portals and mainstream media alike are peeling back advertising for premium members that don’t mind paying a few bucks a month for a cleaner, ad-free experience — but as the old saying goes, “you can’t please everyone.”
Discussing “The psychological impact of an $11 Facebook subscription,” Josh Constine asked TechCrunch readers if this move “would make us love or hate ads?”
It is a reflection of a broader view of the role advertising plays in our lives, on- and offline, and of the value that people place on their entertainment and beyond.
Although Facebook intends to remain a free service supported by targeted advertising, its recent privacy problems have underscored consumers’ wariness over the amount of data that corporations collect about them and how and where that information is used. Since advertising is a big part of that data usage and since most internet users dislike ads, ad-free viewing options are receiving renewed interest — but is an enhanced perception of privacy enough of an incentive to convince prospects to become paying customers without value-added features and services to sweeten the deal?
“Zuckerberg’s stumping for free internet services make it seem unlikely that Facebook would build valuable features and reserve them for subscribers,” Constine explains, noting the difference between free and paid services on other popular sites. “Spotify only lets paid users play any song they want on-demand, while ad-supported users are stuck on shuffle. LinkedIn only lets paid users message anyone they want and appear as a ‘featured applicant’ to hirers, while ad-supported users can only message their connections. Netflix only lets paid users… use it at all.”
Adult sites echo this pattern with practices such as allowing free streaming while reserving downloads for paying customers, and restricting nudity from free cam shows, etc. while running ads for revenue.
“Convincing people to pay more with their wallets than their eyeballs may be difficult. And the ones who want to pay are probably worth much more than the average,” Constine wrote, providing insights into some of Facebook’s various visitor valuation metrics for a measure that adult site operators can use for comparison with their own revenues. “On average U.S. and Canada users earn Facebook $7 per month from ads. But those willing and able to pay are probably richer than the average user, so luxury businesses pay more to advertise to them, and probably spend more time browsing Facebook than the average user, so they see more of those ads.”
As a result, Constine notes, Facebook may have to charge North American users a monthly fee in the $11 to $14 range — a fee in line with entertainment services such as Hulu and Netflix, among others.
“With no bonus features, that price for something they can get for free could seem way too high,” Constine concludes, explaining that having to see those ads really isn’t so bad when faced with the alternative of a steep subscription price. “That’s why it might not matter if Facebook can only get four percent, or one percent, or 0.1 percent of users to pay. It could be worth it for Facebook to build out a subscription option to empower users with a sense of choice and provide perspective on the value they already receive for free.”
There is always a value in serving elite audiences with first-class services, so ad-free experiences should just be a starting point, with value-added services providing the push for sales. Whether enough folks are willing to follow along will determine if the development of those offers was worthwhile.
For adult, Facebook may provide enough market power to shift consumers back onto the “pay for it” attitudinal track that premium media outlets have always relied upon — and that porn paysites among other online endeavors desperately need today.
Regardless of the results, following the company’s efforts will be of interest to any site owner seeking to maximize revenues.
