"Why pay premium in freemium services?" A study on perceived value, continued use and purchase intentions in free-to-play games

Hamari, Juho; Hanner, Nicolai; Koivisto, Jonna

doi:10.1016/j.ijinfomgt.2019.102040

Cited by 141 publications

(160 citation statements)

References 95 publications

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“…As such, the social importance of Spotify plays a crucial role in making users more likely to buy a premium service. The outcome is in line with previous researches [10,34,35]. Spotify should concentrate on creating a well-recognized positive brand that can give the user a good impression and enables the app to help users to express themselves more and create more social interaction with other users, which is currently only minimally given.…”

Section: The Effect Of Social Value On Purchase Intentionsupporting

confidence: 85%

“…This research was then extended to the digital applications where it was found that value for money has a huge influence on the intention to buy paid apps [19]. Similar findings are also obtained in the freemium business model [35].…”

Section: The Effect Of Value For Money On Purchase Intentionsupporting

confidence: 54%

“…the ratio or trade-off between quality and price [10,13,14]. Value for Money is found to have a positive and significant effect on Purchase intention [10,17], and a significant total effect on freemium business model [35].…”

Section: Value For Moneymentioning

confidence: 92%

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The Effects of Social Value, Value for Money, App Rating, and Enjoyment on the Intention to Purchase the Premium Service of the Spotify App

Yulianto

Oroh

2021

KSS

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The use of music streaming services has been proliferating all around the world, including in Indonesia. While being a leader in music streaming service, Spotify is not at their top performance lately due to having reached the maturity stage, and even shows a decline in the percentage of paid users as compared to the total users. Their growth has also slowed in the past five years. Strategic marketers claim that companies need to fully understand the needs of the consumers to create suitable products and therefore grow their company, and failure to do so is creating marketing myopia and problems. This research was done to find out the effect of social value, value for money, app rating, and enjoyment on the intention to purchase Spotify, specifically the premium version of Spotify. The sample was Spotify users who had been using Spotify for at least one month (both free and premium), aged at least 13 years old, who had a smart device, and were domiciled in Surabaya, Indonesia. 135 samples were used. All independent variables positively and significantly affected the dependent variable, both individually and as a whole. The most dominant factor was the value for money, followed by enjoyment, app rating, and finally, social value. The findings can be used to develop strategies to help improve the performance of freemium businesses, including Spotify. Keywords: app rating, enjoyment, music streaming, purchase intention, social, technology, value for money

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Section: The Effect Of Social Value On Purchase Intentionsupporting

confidence: 85%

Section: The Effect Of Value For Money On Purchase Intentionsupporting

confidence: 54%

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The Effects of Social Value, Value for Money, App Rating, and Enjoyment on the Intention to Purchase the Premium Service of the Spotify App

Yulianto

Oroh

2021

KSS

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“…No longer are players necessarily required to simply pay a single fee at the point of purchase, instead there is a drive to create an ongoing relationship between the game, game community, and the players that involves multiple customer-facing interfaces that attempt to promote player monetisation and ongoing engagement. Perhaps the most visible business model driving the Games as a Service paradigm is the Free-to-Play (F2P), or freemium (Hamari, Hanner, and Koivisto 2017b), business model and its combination with retail or subscription models (Hamari et al 2017a). These additional services and game items now generate over 80% of the revenue within the video game industry (Handrahan 2019).…”

Section: Introductionmentioning

confidence: 99%

Does esports spectating influence game consumption?

Macey

Tyrväinen

Pirkkalainen

et al. 2020

Behaviour & Information Technology

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Contemporary digital technologies have facilitated practices related to games whereby users often produce and consume content for free. To date, research into consumer interactions has largely focused on in-game factors, however, the intention to both play the game and to make in-game purchases are influenced by outside factors, including game streams and game-centred communities. In particular, the growth of competitive gaming, known as esports, offers a new channel for consumer engagement. This research explores the potential for esports to be a significant factor in understanding both intentions to play and spend money on games. Our study draws from Motivations Scale of Sports Consumption to empirically investigate the relationship between esports spectating motivations and game consumption: Watching Intention, Gaming Intention, and Purchasing Intention. This survey uses structural equation modelling (SEM) to analyse data collected from a sample of video game players (n = 194). This research contributes empirical evidence of the relationship between esports spectating and game consumption, with the relationship between Watching Intention and Gaming Intention found to be particularly strong. Finally, while the MSSC is an adequate measure for esports spectating, additional aspects specific to esports require further investigation, consequently, there may be more optimal measures which can be developed.

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“…The typology introduced above was built based on the required BM elements of sharing platforms from a holistic DSE perspective. The four dimensions do not include a "why" dimension because the reasons why participation in sharing takes place can be inferred from the other dimensions plus some assumptions about the value perceived by the participants that motivates them to use services [72,73] offered by a sharing platform. Thus, the "why" question is located at a higher level of description.…”

Section: Discussionmentioning

confidence: 99%

A Typology of Digital Sharing Business Models: A Design Science Research Approach

Pouri

Hilty

2020

Lecture Notes in Computer Science

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The digitally enabled sharing economy, also called the "digital sharing economy" (DSE), has changed patterns of consumption by introducing new choices and channels for provision and receipt of services. The DSE encompasses sharing systems whose business models may vary distinctly from platform to platform. Although business models in the context of the sharing economy have been studied so far, we have observed that the current literature does not provide an approach that covers all the possible business models (in the broadest sense of the term) that (potentially) exist within the scope of the DSE. The present paper, therefore, aims to propose a typology of business models in the DSE that covers a wide space of models-even those which may not involve "business" in the commercial sense. This is achieved through an iterative inductive process based on a design science research approach. The typology can assist in positioning the current and future sharing systems in the DSE by systematically classifying their business models. It is intended to serve as a guiding tool for the sustainability assessment of platforms from both resource and socioeconomic perspectives. The present study can also enable researchers and practitioners to capture and systematically analyse digital sharing business models based on a structured, actionable approach.

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"Why pay premium in freemium services?" A study on perceived value, continued use and purchase intentions in free-to-play games

Cited by 141 publications

References 95 publications

The Effects of Social Value, Value for Money, App Rating, and Enjoyment on the Intention to Purchase the Premium Service of the Spotify App

The Effects of Social Value, Value for Money, App Rating, and Enjoyment on the Intention to Purchase the Premium Service of the Spotify App

Does esports spectating influence game consumption?

A Typology of Digital Sharing Business Models: A Design Science Research Approach

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