Selling digital content online will play a very big role in the near future.
In fact it does already. When you take look at Zynga for example, an online gaming publisher, located in San Francisco, which makes estimated $100 million revenue this year, mainly with facebook and MySpace apps, you know what I’m talking about.
PayPal – Expensive but widely accepted
PayPal is very well known around the globe. But when it comes to micropayment it’s very expensive. So expensive, that some vendors, like the well known app store for jailbroken iPhones Cydia, chose to charge an extra fee for using PayPal.
You need a credit card for any PayPal subscription
Even though subscriptions are fairly interesting for content publishers, because people tend to forget about their subscriptions, I would not recommend using this model to charge for digital content online solely.
Let’s say you found a service you’re interested in. For example: twollow.com, a site where you can follow twitter-people, based on keywords automatically, offers a 7-day free trial which then automatically converts into a paid account.
So if you try to register, you will be redirected to PayPal and have to enter your login details. If you have no credit card registered with paypal, you will be prompted to enter your details.
Outside the US not everyone has a credit card
I know, in the US people tend to have 5 credit cards per capita. But let’s take Germany: Only about 20% of the whole population owns a credit card. The rest prefers cash, electronic cash or direct debit.
Latter is used by the vast majority of Germans. Even with their PayPal profiles. You buy something online and the amount will be deducted from your bank account 1-3 days later. So there is no need to have a credit card in Germany.
Offer an option
I found myself in the situation where I wanted to register with E-junkie, where you can sell digital content online.
Their services start with a $5 monthly PayPal subscription. But if I hadn’t a credit card, like the majority of people here in Europe, there would be no way to register for the service instantly.
Either you have to go to your bank and request a credit card or search for another service with other payment options. Which one would be easier?
So the better solution would be, to offer the monthly subscription or pre-charge for the whole year.
Because for every “non subscription PayPal transaction” no credit card is needed. The transaction will just go through via direct debit.
I saw a lot of sites like online radio stations or webhosting companies offering only subscription based PayPal payments. In my opinion they are missing out an opportunity to sell their product to a broader audience.
A good example for a good payment integration, even for non credit card holders, is the online radio station di.fm
Here you have the option to chose between a subscription or an one time payment. So everyone should be satisfied.
