Daily Archives: 22/12/2009

Options for charging for leads – fixed or per lead basis

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Since the soft launch of edocr.com in Oct 2007, we have been delivering value to our users and customers. The value delivered right now can be categorised into “exposure” leading to “prospects contacting you”. We are now entering a phase where our customers will have the opportunity to access “leads”, delivering further value.

We now need to figure out the best way to commercialise the new value addition, “leads”. The two options available are:

1. Charge per lead
2. Charge a fixed fee

I am a great believer of simplicity and keeping all things as simple as possible. Charging a fixed fee is easy. You set up a particular subscription and demonstrate value whereby targeted customers subscribe to the additional new service.

Charging per lead becomes harder to manage. Software need to be able to calculate the number of leads after those leads which are considered to be “noise” (e.g. employee of edocr) are removed, use a set fixed or variable price per lead and invoice or charge paypal the due amount. If variable rate is used, then the quality of leads need to be considered. The customer may also object to the quality of the leads resulting in disputes. The whole issue of providing added value becomes complex to manage from edocr.com’ point of view.

I assume you are familiar with the term “catch 22″. There has been numerous occasions where our customers have asked to know the details of who viewed or downloaded their documents. Whilst this information has always been available to edocr employees, the current build will provide various tool kits for our customers to extract this data with consents where needed. I can almost smell the next catch 22, once customers have the leads, they will no doubt be seeking to understand the quality of the leads we provide.

At this stage, we can only provide details of who looked at a document or a company page (with consent). We cannot judge the quality of these leads and it should not be our role to do so. However, I am convinced that third parties might be able to play a role in here by taking our leads and dissecting them on behalf of our customers.

With that thought, our hunt for those third parties have just commenced. A clue might be in here!

All thoughts on this subject is very much appreciated.

Payment Solutions beyond paypal and others

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I have a problem, both as a buyer and seller on payments using credit cards. I am convinced this problem is not unique to me.

As a buyer – mailchimp as an example
My HSBC credit card was recently cancelled due to two fraudulent transactions in the US. While I am waiting for a replacement card, my subscription to mailchimp has been halted. This causes a number of difficulties:

1. I cannot use the service to communicate with edocr user and customer base through monthly newsletter.
2. I could use my personal credit card, but this becomes a menace from accounts points of view.
3. Gives me a chance to review the benefit of using mailchimp – I was thinking of switching to salesforce.com led solution before – but now this has become a serious option to consider.

So what is the outcome:

1. I cannot speak to my user and customer base, so I am unhappy
2. Mailchimp could loose me as a customer, even though the reason for this is not their own making. The credit card cancellation just happened to trigger this.

As a seller – edocr.com as an example
Currently, edocr.com is integrated with paypal. So the only option to subscribe to edocr Essential service is through paypal unless you contact us direct, at which point, we can invoice you.

Some of the problems we have experienced due to paypal:
1. Paypal refusing to accept customer login details
2. Customer’s paypal account need further verifications, etc to satisfy built-in paypal safety rules
3. Customer does not have a paypal account or not keen to use his/her credit card

All of the above reasons can results in:
1. Transaction delays – lost revenue opportunity for edocr
2. Transaction may never take place, as the moment is lost and the process become a problem for the customer instead of solving a problem s/he has.

In one occasion, we lost a customer as paypal has stopped his account and he is pretty much cheesed off with paypal for many reasons. Of course, we are discussing with him about alternative payment options.

Summary
When you look at both cases, the problem lies in the payment mechanism which could lead to lost revenue opportunities for businesses. So the alternative is to offer multiple payment choices, but is this the right option?

Solution
Most online solutions take credit card based payments, either paypal, google checkout etc. They are designed primarily for individuals and small businesses. However, everyone has a bank account. If you are a company, you are not likely to change your bank account, and these do not expire as credit cards do. Whilst the ultimate solution should cater for bank accounts and credit cards, there is a significant business case to introduce a bank account based service by an independent vendor.

The ideal solution – bank account base
Think about OAuth type handshake, but of course highly secure. You login to edocr.com or mailchimp or any other service, click the payment settings, and now the handshake starts to take place with your bank account. You login to the bank account to confirm, the payment is now set. Easy peasy!

Love to hear your thoughts on how you deal with collecting payment for your web based solutions, and what your ultimate solution may look like. Who knows, someone within Northern StartUp 2.0 community of tech entrepreneurs might come up with a product to solve this problem.