Microtransactions offer huge potential for new user onboarding
Blockchain technology and cryptocurrency presents a world of possibilities for tech companies. One use case I’m particularly excited as someone who works on growth is micropayments. I’ll tell you why in a bit, but first. What is a micropayment? They are small transfers of monetary value with little to no transaction fee. Office Space was ahead of its time.
Sign up for Coinbase and it doesn’t take long before you run into an early use case for micropayments: new user onboarding. Coinbase pays you tokens as a reward for taking a few minutes to learn about fundamental blockchain concepts and partner technologies. Rewarding users to learn best practices, offer feedback, or provide valuable first-party data addresses a fundamental problem: no one wants to do something without getting something in return. Over time, the money adds up. I know I wouldn’t mind earning an extra thousand dollars a year for doing things I normally do when signing up for software services.
Small reward incentives have been around for a while and have a track record of success for fueling viral growth. Referrals incentivized by “50MB+ of free storage” drove 30% of Dropbox’s sign ups for years. B2B software review sites like Software Advice provide monetary rewards to review software. At WizeHire, we reward $10 gift cards to new users in exchange for answering market research questions like what conferences do you hate to miss. Microtransactions are old news in gaming.
These value exchanges benefit all parties, but today instrumentation is manual or requires a non-trivial amount of engineering resources to build and maintain. Quick plug for marketing teams having full-time engineers :) But as blockchain adoption increases over time, my prediction is the “finance-first” nature of blockchain systems will drive down the complexity of implementing microtransactions and in the short-term spur innovation with today’s billing technologies like payment APIs. The need is there because the payoff is big.
New User Onboarding is a balancing act
New user onboarding is a balancing act that requires teams to work together to solve the three most difficult problems that transactional B2B SaaS businesses face.
- How do you get people in the door
- How do you get them to an “aha” moment as quick as possible
- How do you deliver core product value as often as possible
Not collecting the right data about users leads to GTM inefficiencies and incomplete analytics. Collecting too much info upfront without value in return exhausts users and hurts conversion.
GTM, support, and product teams are usually at odds about onboarding because they have different interests. As you can see below, collecting data and educating users during onboarding is high stakes.
Sure you can collect data and advise users later on (and you should), but so much business logic depends on the inputs provided during and post signup. This is especially true for freemium products because they are less engaged and don’t stick around for long. Microtransactions provide growth-focused teams with a powerful tool to keep users engaged with incentives. Paying people for first-party data or product feedback makes the “friction” more palatable because you’re earning rewards.
What’s to come
To recap, rewarding users to learn best practices, give product feedback, or provide first-party data addresses a fundamental problem: no one wants to do something without getting something in return. I wouldn’t be surprised if we see build and buy solutions built around micropayments. Rewards will dramatically increases conversion rates.
Examples of microtransactions use cases that makes sense to me:
Customer behavior (Segment)
Data Enrichment (Clearbit)
Education (Wistia)
Product knowledge/tours (Intercom)
User Feedback (Satismeter)
User Research (Qualaroo)
Rewards is so core to human behavior which makes this next evolution of the internet exciting for growth teams. What do you think about the potential for microtransactions to improve customer onboarding and solve big problems? Let me know in the comments.
