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Freemium Meetup November 2012 - David Weekly

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Freemium Meetup November 2012 - David Weekly

  1. 1. Baking DoughFreemium Lessons from the Real World David Weekly @ SF Freemium June 14, 2012
  2. 2. PBwiki PBworks• June 2005: First private wiki host! Free+ads.• July: $5/mo -> NO ADS (unlimited users)• 2006: $5/10/20 a month• 2007: $10/20/35 a month• 2008: $20/user/mo (unlimited wikis)• 2010: $20-50/user/mo [verticalized]
  3. 3. PBlearnings• A la carte pricing confusing/complex.• “Principle of Least Surprise”, adapt w/users.• When cheap, 100% self-service• Consumer-to-enterprise = hard!• ...but tool-to-solution = >100x $$$
  4. 4. Key Thresholds• $5: impulse consumer buy• $50: prosumer purchase• $500: casual business tool• $5k: serious business tool• $50k: partial solution• $500k strategic solution
  5. 5. Conversion Rates• Expect 1-5% for consumer freemium.• Evernote: can take a long time to get to 5%!• Accumulate unique data (notes, wishlists, travel history, etc.) for longterm value.
  6. 6. Get Baked!• Retention: LTCV++• Sharing: CAC--• Success: CAC < LTCV• Person: become a ritual (for a group)• Company: become a key (team) process
  7. 7. Conflicting Lessons• Enterprise solutions pay well, but...• Consumer: wider audience than ever!• BillUser() call in all OS APIs, soon.• Consumerization of the enterprise
  8. 8. Clear Lessons• Ad inventory on mobile is atrocious.• Exactly where payment APIs are strongest.• In-app purchase is dominating.• Ads overall are a poor user experience, conflicting with what the user wants.
  9. 9. So• Beware ads. (other than as a stick to encourage people to upgrade)• Retain data.• Make purchase easy.• Encourage sharing.• Be useful!