web. Previously, companies offering online products relied on advertising, "freemium", subscription, or pay-per-item to support their business. Now TrialPay allows 3rd parties to pay on behalf of customers who get access to specific resources in exchange for allowing that 3rd party to market one very specific item to the customer. The system relies on a customer wanting the online product strongly enough that he is willing to disclose specific demographic information about himself for which advertisers would otherwise pay equivalent values.I think this may have slow uptake because new customers may be suspicious of these offers or wary that the single offer leads to continuing spam. Also, it's just a bit too confusing for the average person to understand how this works. However, TrialPay raised $3.1 Million from Battery Venture and Index Ventures in series A funding in Dec '06 so they may be able to get the word out and convince customers. PaidContent notes that Zagat (the online restaurant rating site) has used this system successfully to offer customers access to their $25 annual subscription product. About 10% of customers actually accept the TrialPay offer which shows they are appealing and well targeted.
One concern I have about this business is fraud. As far as I can tell, TrialPay relies on the customer's actions to self-select into a specific demographic. Is there any way to show that the user is who she says she is? If this problem were easy to solve there would be a huge industry built around people creating detailed profiles of themselves and auctioning off the right to advertise directly to them. This cuts out the middleman and would allow individuals to chose details they wish to share in exchange for specific offers. Unfortunately, the fraud element has not been resolved. Facebook's new ad targeting efforts are trying to build on the demographic treasure trove of social networking profiles so they may provide an early indication of how well this works.
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