Premium Benefits ~ or lack thereof

<insert requisite "though this thread includes economic data, it is not a discussion of the economy, rather a discussion of premium account benefits generally related to Second Life, so please do frellin' move it" statement>

V. Linden graciously posted some actual figures in the hotline.

It seems that about 8k people bought lindens on Lindex in March, 4k of each account type, with basics buying about 1/3 of the money and premiums buying the other 2/3.

Considering that premiums make up 25% of our population, they seem far more actively engaged per capita than the basics. That's to be expected; but these figures have caused me to change my mind on one point. LL do really need to concentrate some effort on transitioning basics to premiums and on retaining the existing premiums.

Does anyone have ideas to propose in either arena?

(this is cross-posted from this thread)

I'm going to make a modest leap here and try to calculate the number of distinct active basic accounts.

35% of all premium accounts who logged in in March made a LindeX purchase. For the record, this is consistent with the purchase activity we saw on GOM. 8% of basic accounts that logged in in March made a purchase. Of course, some of these basics are alts. The unknown quantity is how many basics are either alts of another basic, or of a premium account.

Vasudha's post states that 70% of the currency was purchased by premiums, and 30% by basics. If we assume that *making a purchase* is independent of account status, with only the *amount* varying, then we come to an estimate of:
# distinct basic accounts = 47,000 basics logged in * 8% making purchases / 35% of logged in users purchasing = ~10,800 distinct, active basic accounts

This would put the total active SL population at around 25,000. Given a daily peak usage of around 5,000 users, we're looking at a peak concurrency of around 20%. This is on the high side with respect to other games, but is consistent with industry estimates.

This could be a powerful argument against the "abolish stipend" party: the people who have a greater stipend, bought more L$. On the other hand, it's possible that most of the purchases were by premiums because they were buying land.

My suggestion du jour is.. create "consumer premium" accounts. Consumer premiums get the same as other premium accounts - increased stipend, first land - but they also get another bonus of some kind, such as specially highlighted titles, ability to choose from a unique additional range of surnames, etc.. The tradeoff? The build tools are disabled for them (with the exception of Edit Appearance and scaling/movement of attachments). They can switch back to a regular premium anytime, but they lose the extra bonus; a consumer premium account can't be created if any regular premium alts exist, and any basic alts lose access to the build tools.

The idea is to attract users who can't, or aren't interested in, creating anything by giving them an extra bonus that those who do create can't get, to make up for the value they lose by not caring about creation.

I think you're getting cause and effect reversed.

It's not so much "basics buy more than premiums", but rather "people who buy lindens are more likely to upgrade to premium at some point".

Like I said BEFORE I upgraded: unless you want to own land on the Mainland, buying Lindens on Lindex is a better deal than Premium. If I quit Coonspiracy Central, I'll tier down for sure... but I'll still buy Lindens.

Why have you quoted this backward? Basics don't buy more than premiums. Around 4000 of each bought lindens on lindex in March. That's 9% of the basics that logged in during the month compared to 31% of the Premiums. Thus my statement "Considering that premiums make up 25% of our population, they seem far more actively engaged per capita than the basics."

Why so many more per capita premiums purchase lindens I don't know. If Vasudha does discover the cause, LL can use that information to prompt people to upgrade. The trick, then, is to retain those accounts as premiums.

It's true that the only reason a person needs a premium account now is to own land on the Linden Estate. My point is that they can offer some more incentive for people to want premium accounts.

I'm willing to bet that a simple graph of premiums over total population over the past two years will show a steady decline. If, per the town hall, Philip is serious about continuing compelling growth of the mainland, they're gonna need to offer the premiums something more than the right to "own" land there.

Remember, correlation & causation are two different things. It's highly probable that the people who can afford premium accounts (or can justify the expense) are also the people who can afford to buy L$.

So they'll buy the lindens anyway and LL shouldn't be concerned about them maintaining premium status. That works if LL is working toward capping their estate expansion and turning the job of land management over to resident investors.

But Philip said in the town hall that the mainland will continue to expand. That requires people owning the land which requires them having premium accounts. Yes there are rentals; but the point is that it works both ways. People who upgrade to premium have tier available, might as well fill it, can only do that by "buying" land on the Linden estate.

Maybe I'm wrong. I see your point. Perhaps, if they're not going to expand the benefits of being a premium member, they should just terminate the status and let everyone be basic. If we're going to rent land from them and purchase lindens on the Lindex anyway, there's no point in having an alternate account type.

Please explain how this could be a powerful argument against the "abolish stipend" party when ...

1. Only 8% of all total logged-in Basic users made currency purchases on the Lindex in the last 90 days as opposed to 35% of premium members, even though premium members represent only 10% of the population.

2. On average, approximately 8% of all logged-in Basic users bought an average 30% of the Total Buy Volume on the Lindex, and approximately 35% of all Premium Users made 70% of the Total Buy Volume on the Lindex, despite the fact that premium users represent only 10% of the population.

NOTE: It's important to point out that many of these basic accounts who purchased currency from the Lindex could also be alts of premium members. So it is entirely possible that the amount of currency purchased by "strictly" basic members is much lower than the respective 8% and 30% stated above..

I thought the argument was that SL could absorb the cost of these free membership fees and the free stipend "handed" to basics because the amount they bring into SL, via LindeX purchases and sinks, far outweighs the amount given them.

Wouldn't a more powerful argument be, not only should we abolish the basic stipend, but ...

...we should abolish the "free" basic account membership option along with it.

The right to 'own' land isn't enough to encourage premium membership - after all, it's really just the right to make LL your landlord, with the disincentive of having to pay an amount upfront to use the land as well.

Not entirely, the premium fee also prebuys 450 lindens a week more than the basic accounts are given.

Cheyenne, how do you know that premiums constitute 10% of the account base?

So, you get an extra 1800 lindens a month with your premium account. That breaks down to the following exchange rate depending on how you pay for your account:

300:1 Anually
240:1 Quarterly
181:1 Monthly

Now if you pay tier - I was paying an extra $15 a month - the exchange gets much worse.

86:1 Anually
80:1 Quarterly
72:1 Monthly

I have tiered down to switched my account to basic. I have access to friends and family lifetime land, so I realized it made no sense for me to pay tier for anything less than an entire sim.

This way I have an extra $21 a month to spend on lindens which comes out to over 6000 lindens a month. What is the current limit on purchasing lindens? $2000? I don't think I will need a half a million lindens anytime soon.

That is the percentage that has been frequently quoted throughout the forums, Khamon. In all fairness, these figures may have been based on estimates according to given data but I'm not sure.

I suppose I could do a search but maybe the person(s) that posted the information can repost it, or perhaps direct us to it. Either way, just disregard my post if you doubt the math has been done, or otherwise been made available in the past.

I was under the impression that it was a widely accepted figure. Please accept my apologies for not providing a link as per your request. I fear that this information may be buried in some of these 300 plus post threads and I'm just too lazy for that task right now

Sokay to not post a link, I just wondered if I'd missed a recent set of linden posted stats other than the economic ones. My figure of 25% is based on just the number of accounts that logged in March.

Thank you for proving my point with numbers Noel. As stated a few times in the thread, there's no real point to being premium unless your just dead stuck on renting land directly from the Lindens rather than a third party. But being stuck with lack of terraformability or the ability to update ground textures makes that option less and less desirable as estate managers are beginning to offer those abilities to renters.

I suppose it's just a faulty assumption that premiums put more money in LL's pocket than basics do. Therefore it would be a waste of their time and effort to enhance premium status for the purpose of recruitment or retention. It would still be interesting to see the ratio over the past two years. I'll ask for that and see what response we get.

*Edit: Posted here.

But shouldn't we look at the players behind those acounts? Isn't a basic account owned by a player with three premium accounts and eight basic accounts a different beast compared to the sole basic account owned by another player?

There are people behind the sl accoubts????

Um, sunspots. Radiation in the air getting on my skin cutting off communication. Bad shrimp. Temporary stupidity. Classified.

What I meant was "this doesn't mean premiums spend more money than basics". That is, you don't have a causal relationship that would imply "if someone upgrades to premium that would make them more likely to buy Lindens". You have a correlation, "people who are premium and people who spend money tend to be the same people".
The trick is to capture and retain the people who are spending money, whether they are premium or basic. Getting people who are spending money to upgrade to premium would benefit Linden Labs... because they get more money from them... but it wouldn't necessarily lead to more activity on LindeX or elsewhere in the economy.

Back On-Topic: I'm currently a Basic Account holder even though I've paid into SL about $90 in the past couple months that I've been active. But I have no plans in becoming a premium member. I have no interest in land right now, and $10 for L$2000 isn't worth it.

So I do believe LL needs to come up with a better incentive for upgrading. Eliminating the Basic Stipend wont' do it, as it's still better to just buy L on the market, and buying an extra $200 a month isn't worth my effort either. Unfortunately, unless some new incentives are created, making the premium membership more attractive will mean reducing the privledges of the basic accounts.

Some possibilities:

1. Prevent Basic accounts from buying L$. This would be a good incentive, but as the recently released data shows, this would really drive only a small portion of the basics to upgrade.

2. Create a tax on purchases by Basic account holders that would be waved for premium members. If every purcahse is taxes X%, it would certainly drive people to upgrade. It's amazing how many peopel turn out for Tax-Free day to shop, even though they're only saving 4.76%. And added benefit would be a very large sink for L$, possibly large enough to eliminate some other sinks. A potential downside would be the precedent it sets, and it may encourage taxation on other things.

3. The most effective, but also the most disuptive I can think of, would be to restrict access to Mature sims to Premier only. Even though there is plenty of non-mature content on Mature sims, it would be a major incentive. Essentially it would make the Basic accounts more like a 'Demo' of SL, with the Premium becomming the 'Full' SL.

Again, these are just some quick ideas, but I do agree that the Premium membership needs more incentive to upgrade.

You're me, up to a month ago, and I suspect I'll be you again in a month or so.

LL needs to get rid of the whole "Premium account" concept, and just have Linden and Land subscriptions something you buy.

A few ideas I had.

All premium members get:
- Extra premium stipend, and
- The ability to own land, if they pay tier.

Then, a resident can choose a single Premium package from those below. They can change their mind at any time (cancelling the previous benefit) except as described below. Scripts can detect a premium user (apparantly they can already do this somehow) and can know which package a person is on.

Landowner: Gets 512m of land tier free and can buy First land. Once a user has bought first land they can never change their Premium package from Landowner, even if they sell the land.

Honoured Guest: Resident provides double dwell.

Announcer: User can use a grid-wide shout, once. After doing so, the user cannot use it again, nor change their package, for 30 days.

Fast scripter: Scripts created by the user are not subject to forced sleeps.

Giant: User's avatar size slider range is doubled.

Bejeweled: User can wear two attachments in each slot.

Publicist: User's Classified ads are placed L$250 higher than they paid for.

Builder/renter: User recieves 25 "bonus prims" which they can assign to parcels to increase the prim limit. The 25 can be divided as they wish between parcels. The user does not have to own the parcel, nor even have permission to build on it. They gain no special priveleges over the extra prim "slots", they can be used by others, but the Premium user can withdraw them at any time.

Party animal: User's avatar does not count against the sim total limit.

I've had a pretty simple idea since day 1, perhaps too simple. In the Account Type field in the profile, why not have that say "Premium" or something when someone upgrades? Most sites/communities that have paid and free users generally have some obvious way to tell paid users from free ones. And honestly, when I signed up (I was a Premium user from day 1, looked like a better deal), I kinda expected something like that to show up. It'd be a really easy way to set paid users apart from free ones, which would likely help get more paid members. It certainly couldn't hurt

I see your point Argent; that's what Adam said too. Having survived a recent series of sunspots, I'm inclined to agree that the premium account ought to just be done away with with the caveat that current premiums retain their fundamental tier rights perpetually.

They'll just sort of transition to mini-life accounts with 512sm or 1024sm of free tier forever.

Maybe we'll see this wisdom invoked at the same time that tier rates (all but full sim) are necessarily raised. I imagine that'll be pretty soon.

What the hell do so many people have against Premium account holders? *We* are the ones who are actually helping *pay* for SL. Basic accounts are free riders. I don't mind that too much, since it does allow there to be more players in game who might not otherwise be able to afford to be here. But why this desire to punish those of us who *are* paying our way?

I have a couple of alts *all* of which are Premium accounts. I am also currently paying $125 (US) a month for half a sim worth of tier. [1]

SL is making money off of me. I'm one of the ones who's helping to support the game. I pay my $21 (US) or so per quarter for myself and for *each* of my alts. For that I get 512m of land, and $L500 per alt, and I'm happy with that, and I feel that I deserve to get what I'm paying for.

So, why are you trying to push an agenda that would *cut* LL's income, and drive me off of SL?

Again, why this desire to punish Premium account owners?

As for raising the cost of tier, I'm currently in the process of selling off some of my land to reduce my tier from 1/2 to 1/4 sim because of cost, and because of the inadequet land managment tools available to mainland property owners to control things like ground textures and most particularly to control griefers.

I'm not running any kind of business off of my land, it's simply a place for my partner and I to hang out and build and have some plesant space to outselves. But if tier costs are raised, I'm not going to pay more, instead I'm far more likely to drop my tier down to four 1024m plots and pay less than I am now.

I hardly see how eliminating the monthly premium account fee is punishing us. We'll likely just roll it into more tier.

I'm not convinced that we're supporting LL lock, stock and barrel either. I know many private estate owners that have basic accounts; but I wouldn't call them freeloaders. I also know many basics that rent land from premiums on the Linden estate. Their money is rolling into the LL coffers eventually as well.

All we're proposing is a single account type called, well it doesn't have to be called anything other than an account. It'll have no flat monthly fee so our costs will be as much tier and Lindex as we want to spend. The only bonus I'd like to keep, for being a faithful premium since before 1.2 was introduced, is my cost-free 1024sm tier. Post1.2 premiums will also keep their cost-free 512sm tier. That's not too much skin off LL's nose to simplify the account structure and make everyone more comfortable.