Product Preview · Growth
Platform fee, one inclusive price
How might we make the fee feel fair, not a penalty?
Why are we doing it?
ORR, by 1 October
Show the total price up front, so nothing appears as an add-on at checkout.
What we build
One inclusive price
A better customer experience
Customers tell us the fee feels sneaky, and it correlates to drop-off rates in the funnel.
The data showed us
Drop-off on our checkout pages is high + fee causes friction late
Drop-off at checkout, by screen
Of everyone who reaches the screen and leaves without paying.
Confirm your bid
Buy upgrade now
It's quite sneaky. Just make it part of the price.
It's not £8. It's £11. This completely bumps it up.
It's that price plus £3 at a minimum.
What we are building
Two changes. One required, one ours.
Every price includes the platform fee
Every price, including results, auction details, bid and buy upgrade now.
Total breakdown at checkout
The fee broken down inside the total, with a description of what it is.
Not in scope: changing the £3, waiving it, or changing the mechanic.
The design
The proposed design
Total, breakdown collapsed
Tap the fee, see what it covers
Total breakdown with a message on what the fee gives you
Today the fee arrives as a surprise, with no short explanation. We are renaming it from platform fee to booking fee, and removing it everywhere else because it now sits inside the price.
User tested
The fee-inclusive pricing model works. One price carried from results through to review, with the bid locked.
Platform fee is not understood, but people make reference to a booking fee. It is more palatable. Indicative only.
* Finance steer: the fee must be described as a fee for arranging the upgrade with the train operator, not a fee to use the platform, or it stops being zero rated for VAT.
Our hypothesis
One price from the start, explained at the end
If
every price includes the fee from the first screen, and we explain it at checkout
Then
more of the people who search end up with an upgrade
Because
there is nothing new to object to at the moment they commit
The risk
The price is not going up. But it will look like it has.
Putting the £3 inside the total makes every auction appear more expensive than it did yesterday. If that puts people off bidding, we get the opposite of what we want, from a price rise that never happened.
Risk 1
Fewer people bid or buy
Every price on screen appears £3 higher. We need to measure and understand the impact of the regulation change.
Risk 2
Cheap routes take the biggest hit
£3 is 37% of an £8 upgrade and 5% of a £55 one. An average hides where it bites.
Risk 3
The messaging itself has a negative impact
Explaining the fee could make it more noticeable rather than more acceptable.
We A/B test it to understand the revenue impact and what to do next. We ship before 1 October either way, with a plan based on the results.
Questions for the room
What other risks should we be capturing insights for?
The test
Three versions, tested side by side
A
Today's experience
The fee appears at checkout, as it does now.
B
Price includes the fee
Nothing else changes.
C
Price includes the fee, plus the message
The total broken down at checkout, with what the fee gives you.
A against B
What the regulation costs us, with nothing else changed.
B against C
Whether our message earns its keep. If it does not, we tweak it.
If revenue drops
How we claw it back
The change may have a positive impact, but we will have to dig deeper into the results to understand it. If we see a negative impact, here are candidates to explore further.
Option 1
Platform fee, algorithm
Replace the flat £3 with something that flexes. A percentage of the price, a percentage of the saving so a cheaper win pays less, or banded pricing.
Mitigates the hit on lower cost routes.
Option 2
Incentives
Waive the fee to change behaviour. Free on a first upgrade, or free after a number of them.
Mitigates the first purchase barrier.
Option 3
Benefits and explanation
Tell customers what they get and what they saved. Lounge access, the saving on that purchase, milestones.
Least likely of the three to move the number.
Questions for the room
Any more ideas you would like us to consider?
What happens next
Next steps
Step 1
Build, aiming to release week commencing 31 August
Step 2
Check in with this group on impact
Step 3
Rollout, decide and communicate next steps
Send the design changes to ORR for approval