A fund account for each user

Rich Z · July 1st, 2005, 06:30 PM

The way members have to pay now for the enhancements of a classified ad are OK for a small system, but as mine is growing, I see the need for a different way of doing this. Eventually I would like to be able to charge per ad placed, but with the current method of paying it would kill off the biggest advertisers.

Here's the problem: PayPal fees. Right now I am charging $1 each for the ad enhancements. When a user pays for bolding, they go to PayPal and pay their $1 to enable it. PayPal extracts 33 cents from that dollar. If a user were to utilize 1,000 enhancements, PayPal would get $333 from MY efforts! That sucks. I really don't like setting up a site that benefits PayPal nearly as much as it would me.

Now look at this if I wanted to go to a pay per ad system. Yeah, $1 per ad doesn't sound bad, but suppose a user wants to place thousands of ads over a year's time? Then it becomes outrageously expensive. Do I really want to chase them away? But I can't really charge less, or Paypal winds up making more off of the transaction then I do. So in reality, there is NO way I can charge per ad and expect it to fly.

What I think would be MUCH more effective and realistic is to have users pay into a fund account. Say make a minimum of $10 per transaction and each ad or ad enhancement could draw from this account until depleted. When the account has become depleted, no more ads or enhancements until they fill the pot again.

This makes a whole lot more sense to me then the current system. It would allow me to charge a MINIMAL fee for ad placements, say 10 cents each, and still keep the current enhancements as they are.

What do you say? Is this feasible sometime in the near future? The payment system as it now is, is eventually going to become a show stopper for me.

snoopy5 · July 5th, 2005, 07:11 AM

Quote:

Originally Posted by Rich Z

...they go to PayPal and pay their $1 to enable it. PayPal extracts 33 cents from that dollar...

I was first surprised to see that high percentages. But you are correct. The problem with paypal is the fixed USD amount they get from each transaction. The lower the user has to pay, the more the site owner is loosing money.

Paypal takes for EACH transaction:

2.9% + $0.30 USD

(Monthly Received Payment (USD): $0.00 USD-$3,000.00 USD)

So this $0.30 USD kills you with these kind of micropayments. For intl. Paypal users, it is even higher. I have not thought about this at the beginning, since we charged in the past yearly fees. So these $0.30 USD are not that high for us at the moment.

But obviously every site owner would love to charge micropayments of $0.50 USD- $2 USD. In that case, $0.30 USD fixed fee plus te 2.9% is a pain in the neck.

So I would support this idea of a "fund-features" in calssified (and of course in Photopost and Reviewpost too), but clasifieds might be the most important part of all 3...

dcpaq2 · July 5th, 2005, 07:42 PM

For those of us who have sites and are just a little more involved. I would like to see something with SSL (Secure Socket Layer) incorporated into Photo Post Classifieds with the ability to support Merchant Account processing of credit cards for those who are setup for this.

I think this SSL along with paypal and the "member account" idea would be a great addition to classifieds.

Doug