Why users pay for on demand content


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Why users pay for on demand content

With the amount of free content we find on the Internet, it is surprising that we pay for on demand content. However, when we stop to think about it... Do we not buy books?

Don't we buy books? don't we go to the cinema? don't we still go to class, despite having tutorials on the Internet?

Today at PLAYBAK we want to explain in detail how on demand content works and why users pay (and will continue to pay) for it: 

What is content on demand?

Content on demand is a video modality that allows users to pay only for the content they want to watch, maximising their investment in entertainment or training. 

To give us an idea, on-demand content is the format used by leading entertainment platforms such as Netflix and Disney +, E-Learning platforms but also other websites such as PLAYBAK. 

There are different ways of subscribing to on demand content, the most common being the following: 

  • SVOD (Subscription Video on Demand) The user subscribes fully to a streaming video platform or channel and has access to all the content. In some cases, the user must pay an extra amount to view exclusive content known as Premium. 
  • TVOD (Transactional Video on Demand) The user pays only for the videos on demand that he/she wants to watch, having restricted access to the rest of the videos on the channel or platform. 
  • AVOD (Advertising video on Demand) In this on-demand content system, the user has free access to a series of videos with advertising. The creator generates revenue from the advertisements viewed rather than from the subscriber's payment. The most famous case of AVOD content is YouTube videos. 

Once we know that certain platforms such as YouTube or Instagram offer hundreds of hours of free video, it is normal for creators to wonder whether it is worth creating content on demand, or whether it is better to offer it for free and obtain advertising revenue. 

At PLAYBAK we want to answer that question in detail: 

On demand content VS free content Which to choose as a creator?

When we ask ourselves this question, we tend to have only one thing in mind: 

Which of the two is more profitable? 

While both types of content can be very lucrative, they also work differently: 

  • Video on demand provides quick revenue: When someone subscribes to your streaming video channel, you get paid for it. Each platform has its own internal policies, but the money always comes with the first subscriber. On free video platforms you need to meet a number of requirements, such as a certain number of subscribers or viewing hours. If you don't reach these numbers you won't be able to insert advertising, so your revenue may never come in.
  • Advertising revenue tends to be low: Although there are exceptions, the average revenue per 1,000 views on YouTube is only €1.00. Can you imagine the economic benefit of the same on-demand views? The difference is huge.
  • More control over promotion: While on free websites you depend on their design and algorithms, on video-on-demand platforms you have more freedom to promote your streaming video channel or create an effective sales page to attract subscribers. 

Now that you know why on-demand content is a great option for you, it's time to answer the big question: Why do users pay for on-demand content? 

Why users pay for on demand content

1Video on demand is ad free

Let's face it: advertising is annoying. We have been paying for ad-free content since satellite TV. 

In the 21st century where ads are chasing us everywhere, enjoying good ad-free content becomes an out-of-this-world pleasure, so there is every indication that we will continue to pay for it.

2Feeling of exclusivity

On-demand content provides a sense of exclusivity to your subscriber. In their mind they know that they are seeing something that not everyone else can see, privileged content just for them.

This not only makes the subscriber feel special, but also creates a sense of unconscious self-confidence for "knowing more than the rest" if we are talking about E-Learning videos. 

Let's take an example: YouTube is full of fitness videos with millions of views. Those millions of views mean that a lot of people know the "open secrets" taught in the video, so that subscriber will not get any additional benefit from watching it.

By contrast, when we watch a video on demand, we know that this information has been given to a very specific number of people, who have also paid for it. In our brain there is a feeling of knowing privileged information that places us above others who do not know it. 

3When something is inaccessible it seems more valuable to us

Humans tend to judge the value of a product by how accessible it seems to us. 

The clearest example of this can be found in the automotive sector. What makes you sigh more, a Ford car or a Ferrari? 

According to the scarcity principle defined by Robert Cialdini (Author of Influence, Psychology of Persuasion) we value a product or service as more valuable when we think that it can escape us. 

Based on this principle, there may be a great tutorial on YouTube about your industry, perhaps even impossible to beat. However, on demand content will always seem more effective than a free video because of the scarcity principle. 

This is the same reason why many companies offer limited-time offers in order to increase sales.

4Subscribers perceive greater honesty in on demand content

When we pay for content we help its creator financially, becoming his source of income. 

For this reason the author does not need sponsorship, which allows them to create a more personal course with 100% honest recommendations. 

This does not mean that all free videos are sponsored by brands, but it does mean that the perceived sense of honesty in on-demand content is greater. 

Remember that in our social media guide to drive traffic to your streaming video channel we recommend you to create free content (Real and sincere) to attract subscribers to your E-Learning channel. 

5There are those who want to contribute to your sector in a disinterested way

Although not the main reason, many people prefer to pay for on-demand content to contribute to your industry, or to you as a creator. 

These subscribers are strongly influenced by the principle of reciprocity. We are talking about people who do not feel good when they only receive without giving something in return. 

Again, this is the motivation of a small group of subscribers, but it is also a very important answer to why users pay for on demand content. 

6Simple curiosity

On demand content generates curiosity simply because it is private, you as the creator can play on that curiosity to attract even more subscribers.

By creating a sales strategy that leverages the curiosity of your target audience, you will get a lot of people to subscribe, just because they want to know what you really have to offer. 

Of course, you must create high-value, on-demand content, so that the subscriber is satisfied and their curiosity to watch the next videos increases rather than decreases. 

This is clearly seen in collection instalments, where the first instalment is free and then you have to pay for the others, even if you have a lot of that free knowledge in libraries and on the internet.

 7Because everyone is doing it (Dragnet effect)

In psychology, there is a cognitive bias known as the Pull Effect that leads us to perform certain actions just because "everyone else is doing it". The more people pay for on-demand content, the more likely it is that even more people will do it. 

If we take into account the increase in views that video on demand has experienced in the last few years, it is easy to deduce that the pull effect on on demand content will become greater and greater. 

For this very reason, the more subscribers your streaming video channel has, the more new followers it will gain on autopilot. 

Getting reviews and testimonials from satisfied customers will help you take advantage of the pull effect, getting more subscribers to pay for your on-demand content without you having to make more effort on your part.


The answer to why users pay for on-demand content is very broad, and is well rooted in human psychology. We like exclusivity, we like to feel different as well as integrated, and above all, we don't like advertising. 


For all these reasons, video on demand is a growing sector that you can already take advantage of. 

Join PLAYBAK by registering in the BETA version, be one of the first 50 to join and do it for free. Become a #Playbaker and get traffic today.