The value of a non-paying customer?

None you say? Not quite. Read a post about research done by some business school professors on the value of customers in a networked business, that is, a business that thrives on attracting both buyers and sellers, like eBay. In these cases only sellers pay a fee and buyers don’t but you still need the buyers to generate the business. Therefore, also the buyers – the non-paying customers – represent value. The profs have built a model for a simple two-sided business model that shows that the non-paying customers actually are of more value to a company than the paying ones. Currently they’re expanding their research to more complex networked models but it is interesting to see where this goes. It might become my standard explanation at cocktail parties when I have to explain why I don’t plan to charge one type of customers for the service I’m about to launch 😉


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