Wednesday, May 29, 2019

Podcast: FairPay as a New Logic for a More Human Economics - a Wide-Ranging Conversation

A podcast of a very wide-ranging interview of me by Jeff Saperstein is now online. Jeff nicely steered our conversation to briefly highlight not only the basic ideas of FairPay and how it can change business-to-consumer relationships, but also how this bears on many broad issues of current concern about how market capitalism works for people -- as customers, workers, and citizens.

(Jeff is co-author of Interconnected Individuals and a companion Web site that hosts a series of podcasts. He is a career coach with a background in communications and marketing and a focus on values. Our discussion was on 4/22/19, and we covered a lot in 38 minutes!)

Here is a sampling of what we covered ...from the basics:

There is growing unease with how market capitalism is failing society and workers.  FairPay begins with a focus on unrecognized issues in how conventional economics no longer works for digital content and services. That leads to new perspectives on business more generally.

The invisible hand flails: "information wants to be free," but it also "wants to be expensive." Current pricing models for content -- all you can eat subscriptions -- increasingly fail to serve all but the most voracious consumers. Digital services companies fail to see that "artificial scarcity" is a short-sighted response, in direct conflict with the overarching shift of commerce from isolated transactions to recurring revenue relationships based on value and loyalty.

FairPay and related value-based solutions offer a practical new logic for creating and sharing value.  The full, customized, participative FairPay solution leads to consideration of true value in its fullest aspects, combining the complementary perceptions of both the provider and the customer over the course of a developing, evolving relationship -- but still fitting within the familiar context of individual business to customer relationships.

"Risk-free" subscription models build on the same value-centered principles, but are even simpler to understand and apply. While not as fully risk-free to the customer, they leave the provider in full control of pricing -- so may be more readily adopted by businesses, while still providing significant benefits on both sides.

This perspective also casts light on the good and the bad of "dynamic" pricing -- as currently done secretly by providers in ways that customers view as manipulative, compared to more cooperative and transparent new forms.

...to the broader implications and potentials:

The FairPay perspective also sheds new light on how our platforms and social media have lost their way, with perverse incentives to serve advertisers to the detriment of their users. It points to how better business models can refocus them to serve what their users value. One part of that is giving users credit for their attention and data, making ads more win-win for consumers, advertisers, and publishers/platforms.

We explore how shifting to value and fairness-based pricing can harmonize fair exchange down the value chain -- to more fairly compensate the people who work to create the value we consume.

We also talk about how this can work across the value chain -- to let provider-direct and aggregated offerings coexist harmoniously to serve varying needs without perverse economic conflicts.

On the broad logic of capitalism, we speak about how the logic of FairPay can better align shareholder profit with customer and community value -- to incentivize businesses to create value in the broadest senses. Businesses will find reason to focus on lifetime value to the customer  (not just the long-term but self-serving metric of "customer lifetime value" to the business).

We speak of empathy for customers as an intrinsic element of this broad logic of value, and how capitalism can refocus entrepreneurs and investors on creating wealth for all of us. Behavioral economics and related research shows that people are wired to cooperate in creating value. Market economics can be the most effective way to do that once we re-learn how to build on that at scale -- "to re-mold it nearer to the heart's desire."


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More about FairPay

A concise introduction is in Techonomy"Information Wants to be Free; Consumers May Want to Pay"

For a full introduction see the Overview and the sidebar "How FairPay Works" (just to the right, if reading this at FairPayZone.com). There is also Selected items (including links to videos and decks). 

The Journal of Revenue and Pricing Management, "A Novel Architecture to Monetize Digital Offerings" provides a scholarly but readable overview. 

Or, read my highly praised book: FairPay: Adaptively Win-Win Customer Relationships.

(FairPay is an open architecture, in the public domain. My work on FairPay is pro-bono. I offer free consultation to those interested in applying FairPay, and welcome questions.)

1 comment:

  1. I do agree with all the ideas you have presented in your post. They are really convincing and will certainly work. Still, the posts are very short for starters. Could you please extend them a bit from next time? Thanks for the post.
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    ReplyDelete