The Freemium Model

We used to place clients who needed hosting with a local hosting company. They were always excellent and we had no complaints. But we now usually host with WP Engine.

How did that happen? We met the guys from WPEngine at WordCampKC and they gave us a free account. We tried it. We loved it. Our designers love it. It’s better in certain ways that make a difference to us, even though we continue to have the local guys as our company’s website hosting company and see no reason to switch.

We would never have changed just because it might be better, but trying it out was convincing. We’ve become cheerleaders for WPEngine, and who knows how many people we’ve led to them by now? Multiply that by the rest of the people who tried and loved their free hosting offer, and they have a small army of fans spreading the word. That’s what you can get from a free sample.

So how do you get out those free samples? You can do it in person as the WPEngine guys did, you can send out free samples to carefully-chosen brand ambassadors, but if your product is available as a subscription, you can also use a fremium model.

Fremium means that there is some limited set of tools that you allow people to use for free, and that there are also paid services — a premium set — that you plan to charge for. Some people will continue to use the free services for years, possibly sending paying clients along the way (Hi, MailChimp!), some will decide the services are not for them, and some will love the free enough to step up to the premium services.

Here’s what it takes to make the fremium model work:

  • The free services have to be good enough to persuade users to try them, and to hint at what’s great about the premium service.
  • There has to be a clear enough difference between the free and the premium that premium users can tell what they’re paying for… and free users can see what they’re missing. Allowing more users, providing additional features like analytics, or removing ads are some of the kinds of differences we often see.
  • Free users need to be reminded of what they’re missing on a fairly regular basis. They need to feel like people standing on the ground, and just a few clicks away from soaring in the clouds. Emails can be a very persuasive way to remind people, as can the button offering them those analytics… once they upgrade.

If you can make your free services good enough that your customers keep using them, the paid services can be something for them to step up to.

Often, services that start out as fremium become all paid (Salesforce is an example). But if you know that you want to offer a fremium option, make sure that your web designer knows that when you build your website. That way you’ll have the tech in place when you need it.






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