Blog micro-transactions – a viable business model?

Submit to StumbleUpon

Hello and welcome back to my blog!

If you’re a regular reader, you make have noticed that my technical articles often come with source-code that you can buy if you would like to have a concrete implementation of the ideas I talk about in each article. I’m not sure if this is a new idea or not (probably not) but my decision to try it was based on necessity more than anything else; I’m rapidly running out of money since our game PuzzleShare didn’t take off the way we’d hoped it would (as described here).

The idea

The idea is simple; write a technical blog-post which contains a thorough description of the technique, diagrams, code snippits and working examples directly on the page and then provide the source code for the working examples at a small cost.

I always make sure that the reader has enough information given in the articles that they could implement the techniques described without buying the code, but can save themselves some time if they do – rather like in social games where you can buy more coins instantly instead of slowly earning them!

Farmville

I think that its very important an article give as much to the reader as possible in terms of value before asking for anything in return; again very like the free-to-play model itself.

Results

I’m always very grateful when other articles reveal actual hard numbers to illustrate business concepts, so now its only fair that I do the same here.

I’m going to look at the two most popular pieces of source-code that I’ve made available so far which go with the articles, speculative-contacts-a-continuous-collision-engine-approach and physics-engines-for-dummies.

Speculative contacts – $6.99/unit

Page-views

Above are the number of page-views for the article itself.

Sales

Above are the sales figures in USD by day.

So, we have a conversion rate of between 0.17% and 1.5% from page-view to purchase.

Physics engines for dummies – $3.99/unit

Page-views

Above are the page-views for the article.

Sales

Above is the sales by day, in USD.

Conversion rate between 0.007% and 0.1% from page-view to purchase.

The colossal difference in page-views between the two articles is due to us getting on to page 3 of reddit.com with this article, which made reddit my new favourite thing in the world. Unfortunately, the conversion rate was an order of magnitude worse than the previous article.

Google Adsense

Lets compare with one of the traditional methods of monetising a blog, Google Adsense:

Adsense

Earnings in GBP by day. Conversion rate was between 0.04% and 0.37% which, I understand is quite low. For some reason adsense was reporting a lower number of page-views than Google Analytics; perhaps this was due to people running Adsense blockers.

So, the mirco-transactions model is performing a lot better than just straight advertising – roughly 10 x better performance which is very encouraging.

Concerns

So what about the issue of losing the competitive edge to the competition by selling little pieces of the technology that make your company unique?

I strongly believe that the advantages for the greater good in terms of learning and knowledge-spreading far outweigh any selfish concerns about technological edge – I’d much rather see this stuff getting used to improve games and software in general than keep it under wraps gathering virtual dust.

From the ashes

Even if a project doesn’t go to plan (as has happened to us), there is always a positive side; and in our case it is that many of the pieces of technology that we created during the development of our apps can live again in the form of articles, code-snippits and downloadable source-code.

Code can rise again

Indeed, it can even stand the chance to make the company some money too.

Conclusion

I am quite pleased with the results of this experiment in business models; of course its ultimate success relies completely on being able to generate enough traffic and of course, actually having a quality article with which to sell the source-code through.

As it stands, its not quite enough to live off by itself, but with time it could become more interesting in that regard as my readership increases and it certainly covers the hosting costs quite nicely.

I will still continue to run Adsense on the blog and try to fine tune that low conversion rate without compromising the readability of the articles. I will post any updates when I have them.

Until next time, have fun,

Cheers, Paul.

Submit to StumbleUpon

About Paul Firth

A games industry veteran of ten years, seven of which spent at Sony Computer Entertainment Europe, he has had key technical roles on triple-A titles like the Bafta Award Winning Little Big Planet (PSP), 24: The Game (PS2), special effects work on Heavenly Sword (PS3), some in-show graphics on the BBC’s version of Robot Wars, the TV show, as well as a few more obscure projects.   Now joint CEO of Wildbunny, he is able to give himself hiccups simply by coughing.   1NobNQ88UoYePFi5QbibuRJP3TtLhh65Jp
This entry was posted in Business. Bookmark the permalink.

18 Responses to Blog micro-transactions – a viable business model?

  1. Chad Layton says:

    You might have a little better conversion rate using something less terrible than PayPal. It’s always a huge pain when I try to use it. I just spent 20 minutes messing with that site trying to give you money for your Physics engine for dummies article! Maybe add an option to use Google checkout? I’ll give it another shot later and hope PayPal has figured out it’s shit by then =)

  2. esimov says:

    I think new technologies like microblogs (twitter) can produce enough traffic to your blog resulting in new posts, which if have top qualities can emerge to some good revenue.

  3. Pingback: conversion rate - value websites - Flipping - Website - profits

  4. Hi Paul,

    it is an interesting concept, and I love the fact that you have posted the results. I hope everything turns out well in the end and you make a zillion bucks with your software ;)

    If you really provide enough information in the posts (I have not read them, but will give a look to both later/someday), selling the code to save time is a very good and neat idea. Sometimes doing the code is all the fun (like when I tried an stochastic hill climbing algorithm to approximate images by triangles) or only less-than-half the fun (my code to generate Lavaurs chords in complex dynamics). Having the option to pay to solve the “half the fun problem” is definitely huge (sadly I didn’t have the option back then and had to code it from scratch… it was useful and instructive at the end).

    Cheers,

    Ruben

    • Paul Firth says:

      Hi Ruben,

      Thanks for the encouragement :) Your experiments in coding look excellent, btw – I particularly like the triangular approximation of images.

      Saving time can be a huge win, especially if you have tight deadlines to meet in a project or have other priorities like coding the actual game… As to whether this idea will pay off, only time will tell :)

      Cheers, Paul.

  5. Mehmet Gadrill says:

    I would never purchase code from a site like this. I think it looks like micro-prostitution of oneself.

    • Tim says:

      Wow. With that thinking, anyone who works for someone else is prostituting themselves…

      The posts are super informative and appreciated.

      This is no different than paying for a book and I’m happy to be a member supporting Paul’s great work. :)

  6. Pingback: Ancillary revenue | Stories of a (failed) entrepreneur

  7. Pingback: Is Affiliate Marketing a Viable Business Model for Successful Businesses?

  8. Pingback: Successful Online Business Models That Make You Cash | Article Lane

  9. Pingback: Proven Online Business Models That Make You Money : Niche Success Pro

  10. Pingback: Make Money Blogging – Uncovering The Secrets | Money Making Business Ideas

  11. Pingback: How To Select An Internet Business Model

  12. Pingback: What Exactly is a Business Model? | Innovation Toronto

  13. Pingback: Different Models OF Online Business – Informational Resource SEO Blog | Online SEO Blogger | Basic Seo Tips | Advanced Seo Tips | Seo Busines

  14. Pingback: Blog micro-transactions – a follow up | Paul's blog@Wildbunny

  15. asish says:

    Sir , You are great but let me tell you what I felt knowing your story.
    - Graphics are not appealing(First thing any gamers see)
    - 2 person is enough if u have great idea but .. make games as a side project. Don’t quiet the good job you have.
    - Find some good graphic artist and music designer who are willing to join your project for a profit share rather than getting hired.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

WP-SpamFree by Pole Position Marketing