This short module looks at the pricing model that allows customers to choose the price. It talks briefly about the advantages and disadvantages and lists some examples.

1. (Stanford BUS-21)
Martin Westhead
Mastering Marketing
Donations / Pay What You Want (Can)
How to make money
by giving things away

2. Overview
 Pay What You Want Model
 Examples
- Radiohead “In Rainbows”
- Disconnect.me
- Canonical (Ubuntu)
- So All May Eat Café and Panera Bread
- Vimeo Tip Jar

3. Pay What You Want
(PWYW)
 Buyer chooses price – sometimes $0
 Includes “Tips”
 Attractive to buyers
- Avoids “buyers remorse”
- Removes adversarial nature of price setting
 For seller
- Avoids costly (risky) pricing decision
- Addresses varying value perceptions and price
sensitivities in buyers

4. Pay What You Can (PWYC)
 Sometimes used synonymously with PWYW
 Often more charity / social causes
American Museum
of Natural History

5. Radiohead “In Rainbows”
 Early download offered as
PWYW
 What did people pay?
- $0 - $20
- Average $6
 Most commercially successful
Radiohead Album
- 3M copies
- $80 deluxe set 100K
- 30K copies in first week (even
2 months after PWYW)
- 1.2M tickets sold for tour

6. Disconnect.me
Privacy solutions company

7. Tip Jars
 Launched by Vimeo
in 2012
 Content creators
easily add a Tip
button
 85% goes to creator
 Plus and Pro only
 Also offer Paywalls
and Ads
http://www.reelseo.com/vimeo-ushers-video-
monetization-tip-jar/

8. Donate buttons
 Available on
- Blogs
- Open Source Downloads
 Integrations with CMS
- Wordpress
- Jumla
- Drupal
- Tumblr
 Software download issue
- Often see value long after
donation opportunity has
passed

9. Canonical
 Creators of Ubuntu
- Linux distribution
 Downloads are free
but…
 Encouraged to pay for
feature requests

10. So All May Eat (SAME)
Cafe
 Non-profit in Denver, CO
 Pay What You Want Restaurant
 “Making Healthy Organic Food Available to all”
 Accept an hour of work for food too
 Costs
- $2,000 a month for rent
- $2,000 for the food
- Average meal costs $2
 Revenues
- Average donation $3.66
http://en.wikipedia.org/wiki/SAME_Cafe

11. Panera Bread
 Chain of bakery-café restaurants
in US and Canada
 2010 created Panera Cares
 CEO Ron Shaich based the idea
on SAME Cafe in Denver,
Colorado
 Dearborn, Michigan; Portland,
Oregon; Chicago; and Boston
 Each site serves 3500 per week
http://en.wikipedia.org/wiki/Panera_Bread

12. Overview
 Pay What You Want Model
 Examples
- Radiohead “In Rainbows”
- Disconnect.me
- Canonical (Ubuntu)
- So All May Eat (SAME) Café and Panera Bread
- Vimeo Tip Jar