World Association of Newspapers and News Publishers


Paid-content systems and solutions for publishers, part 1: LaterPay

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Paid-content systems and solutions for publishers, part 1: LaterPay

WAN-IFRA: How, specifically, does LaterPay's solution differ from other micropayment solutions on the market currently or in the past?

Cosmin Ene: LaterPay pursues a user-centric approach to micropayments. Whether it's a journalistic piece, a picture gallery or a video, the user can consume any digital content first and pay later. Upfront registration isn't required, and the user can access the content with just two clicks. It essentially keeps a running tab for all your digital purchases. This comes from our belief that users are willing to pay for digital content on the internet, as long as the payment process is as easy as possible. Users are then able to get to know the content of publishers.

When the total value of content purchased reaches 5 euros, they are prompted to register and pay. They can then access all content from any publisher from their LaterPay account. Publishers are having success converting casual users to paying users with LaterPay.

There is skepticism as to how viable micropayments are as a paid content revenue stream for publishers. How does LaterPay address those doubts?

There is no perfect way to approach micropayments. We advise all content providers on the internet, whether it's a newspaper or a special interest magazine, to think of its journalistic portfolio as an online shop. LaterPay helps to set up a sales funnel on the publishers' own website. Not every option is suitable for every user. There is a pretty small chance that you can turn a new visitor to your website into a subscriber with just one step. So our approach is to make different offers available online in order to gradually draw users down the sales funnel.

I'll give an example: if a user buys several articles about a specific topic, we offer a time-based pass with access to all content about this topic. This way, we help publishers cultivate their users step-by-step and start a relationship with them centered on the user's choice. We believe it is essential to impress users with the quality of a publisher's content first,  before building a loyal, steady relationship.

How is LaterPay integrated into a publisher's site, i.e. technically what is involved?

We offer two approaches:

  1. Publishers can incorporate LaterPay via API as a custom backend integration, or
  2. Use our LaterPay Connector, a convenient front-end integration with only one line of code.

What is the basic business model for both sides – publisher and LaterPay?

Publishers can turn their website into an online shop using LaterPay. They don't give their content away to an external reseller, but essentially build their own newsstand. Surfing the internet is all about cherry-picking, so we advise publishers to unbundle their content and realize that there is no "one size fits all" solution for their users. Publishers can tag their content with any price point above 5 euro cents per item. LaterPay bundles these micropayments and processes them in a cost-efficient way. Publishers can also offer time passes for a day, a week, or a month for different configuration at a higher price point. LaterPay takes a fee (15 percent) of all content sold with our micropayment solution.

What can you share about your clients' success rates in getting readers to pay for content once they have reached the limit? And please explain exactly how that works.

When a user has consumed 5 euros worth of digital content, a LaterPay message prompts them to register and choose their favorite payment solution. Users have to pay their running tab in order to consume further content from any publisher using LaterPay. Up to this point, we can track a user's device by referencing several indicators. This all transpires in accordance with strict data protection guidelines. We have found that more than 80 percent of LaterPay users who consumed 5 euros' worth of paid content registered and paid their tab because they wanted to continue to use LaterPay.

How has adblocking affected all of this?

Adblocking is a relevant concern for every publisher, and we address this with our LaterPay AdVantage solution. One of our first customers in Germany for AdVantage was Gruner + Jahr, and they were able to reduce the adblocker rate by up to 45 percent. In our experience, users appreciate having a real choice. So we advise publishers to start a dialogue with their users about the value of journalistic content rather than pushing unwanted ad delivery against the user's will.

AdVantage can be integrated easily with our LaterPay Connector and is aligned with our user-centric approach. If a user with an active adblocker visits an AdVantage website, he or she will see a message requesting that either they turn off the adblocker or buy a time pass to get access to the content. This allows publishers to make users recognize that the content they seek is valuable and must be paid for in some way, while also reducing their adblocker rate at the same time.

How many news media clients do you have today, and where are they based?

We are currently preparing the international launch of LaterPay, starting with the USA later this year. At the moment we offer our service only in Germany. We have about 100 customers in Germany, including such major publishers as Der Spiegel, Frankfurter Rundschau and Gruner + Jahr.

Who are your competitors in this field?

Generally, publishers evaluate the market of payment solutions and either have to create a custom-built solution or rely on a paywall provider. Interestingly, decision makers often don't rely on their own research or testing and instead focus on the integrations that competing publishing houses use. My best advice is to test as much as you can and look inward and focus on your own content and customers. There is no best-practice example that applies to every publishing house, but LaterPay offers publishers a highly flexible toolkit that allows them to create their own solution.


Cosmin Ene is an entrepreneurial founder with extensive first-hand knowledge of the life cycle of entrepreneurial ventures, accumulated over 18 years. Between 2005 and 2009, Ene was co-founder and managing director of DELUXE Television. Prior to that, he was analyst and associate at Munich-based TecVenture Partners, a venture capital investor in the IT, internet and telecommunications sector. In 2010 Ene started his current venture, micropayment enabler LaterPay.

Author

WAN-IFRA Editorial Staff

Date

2016-12-08 12:10

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