Freemium is becoming a common business model for SaaS vendors wishing to gain market share in short time, get awareness & attention to their product and hopefully sell their product eventually. The vendor next challenge is converting the Freemium customers into paying ones. The following presentation provides an overview about the challenges vendors are facing in the sales process to Freemium customers. We invite you to contact us and share your challenges with us : http://ignitecloudware.com/sales/

1. Igniting Your SaaS Cloud Sales
From Freemium to Premium
B2B SaaS’ Challenges in Conversion Process
Revital Libfrand, Co-founder
Ignite Cloudware

2. 2
Why Freemium?
Freemuim is a business model based on the concept where the
company give a limited version of its core product away for
free and sell premium products or services
The freemium model is used in several variation both for B2B
& B2C, companies choose the freemium model to:
• Gain large volume of users easily
• Brand awareness
• Generate product attention so free users will convert into
paid customers
• Gain community of product fans so free users will attract
paying customers

3. 3
Types of Freemium Model
Capacity based
Freemium
Get limited
capacity
(usage, # of
users etc) for
free,
additional
capacity
requires
payment
Feature based
Freemium
Get limited
features for
free,
additional
features
requires
upgrade to
premium
version
Get Ads
Freemium
Get free sw
access license
with Ads;
Removing Ads
requires
payment
Use case based
Freemium
Free access
based on
usage i.e
Developer
free license,
Non
commercial
use free
license etc

4. 4
- Suit mainly B2B
- Consumer is exposed to all features from
day one
- Conversion to premium is easier from
consumer perception as the product is
already adopted.
Capacity
Based
Freemium
Capacity Based Freemium -Highlights

5. 5
- Suit both B2B & B2C
- Limited version must provide true
benefit to consumer to avoid churn
- Upgrade to premium is not trivial from
consumer perception as it requires users
new adaptation process
Feature
Based
Freemium
Feature Based Freemium -Highlights

6. 6
- Suit both B2B & B2C
- Consumer is exposed to all features from
day one
- Conversion to Premium is done to
remove vendor watermark or remove
sponsored Ads
Get Ads
Freemium
Get Ad Freemium -Highlights

7. 7
- This model is used to enable users adopt
product in certain environment
(developer, non-commercial, students etc)
so once they become decision makers
they will be more likely to pay for the
software
Use case
Based
Freemium
Use Case Based Freemium -Highlights

8. 8
SaaS Vendors Challenges in conversion process
SMBs may never reach the paying level and vendor should consider the cost
of free users
Vendor must communicate to Consumers the benefit of the additional
features and their ROI
Consumer learned to get alone in Ads environment
Ensure the Ads revenue model works for their product
Challenge to properly monitor consumers’ usage
For all Freemium models, vendors must ensure that the
marginal cost of each additional Freemium user is close to 0
Feature
Based
Capacity
Based
Get Ads
Use
Case

9. 9
Breaking the Freemium Boundaries
Many SaaS vendors who introduced successful freemium business
model by building easy-to-use product that automatically convert
leads to users often struggle with the role of sales in their
organizations
Key topics for Freemium to Premium Sales Strategy:
• Adjust Consumer Internet Techniques while approaching your
B2B customers
• Use Only Inside Sales Teams- The team needs to be able to sell
strategically over the phone avoiding face-to-face visits with
the customer.
• Support the sales process with nurturing leads marketing
campaign

10. 10
Creating a successful sales campaign Freemium to Premium
• Freemium users are great inbound leads source for your
inside sales team
• Preparation for a successful sales campaign:
• Analyze how your free users are using your software
• Allocate relevant inside sales REP with the required skills
to perform the job
• Test several sales scenarios on few groups of users and
decide what is the most efficient campaign
• Adjust the sales campaign to the Freemium model you
are using.

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Key to Campaign Success
Any sales & marketing campaign requires proper planning, clear
goals definition ((# users, % retention, product usability etc), KPIs
measurement along the way, analyzing the results and constantly
adjust & improve the process in order to increase conversion rate
in every stage.
Define KPIs
Measure
Analyze
Improve
process

12. 12
Matching Sales Campaign to Freemium model- example
Feature based FreemiumCapacity based Freemium
Initiate a service campaign that
includes a survey.
The questionnaire should
include questions that enable
your Sales REP to provide an
“offline” recommendation
which refers the customers to
capabilities that exist in the
premium version and create an
interest with the premium
version
Sales campaign: generate target
list report for your inside sales
team with users that reaches
capacity threshold (i.e. over
80%)
Campaign Concept
Farmers in their nature, must
have deep knowledge of the
product and how the customer
could benefit the Premium
features for his business
Hunter in their nature, with
ability to understand the
customer growth plans
Sales REP Skills

13. Are you struggling allocating
inside sales resources for your
Freemium to Premium
Campaign?
13

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Inside Sales Organization Service
HR Recruitment
- Define candidate pre-requisites : Academic Degree, Language, high
communication skills
- Phone interview followed with Personal interview
Cloudware School
- General sales topics
- Vendor Tailored topics
Sales Assignment
- Optimization of Sales REP to job
description
Sales kit preparation
- Detailed documented sales
process script
Logistic & Support systems
- Phones, Station work
- Relevant SW : CRM, punch clock
etc
Ignite Cloudware Provides wide Sales & Marketing services to SaaS
vendors.
Our inside sales team setup & ongoing management in a nutshell :

15. 15
Ask me how to build an optimized inside
sales team for your SaaS business
www.ignitecloudware.com
+972-72-2116601
revital@ignitecloudware.com