>What can freemium webapps learn from freemium games?
Games have some advantages that can be hard for apps to replicate; games are, in general, more social than typical applications. Games are also somewhat more enviable. When I was 11, a few friends and I played RuneScape (remember runescape?). After one of us got a paid membership, everyone else suddenly got way more interested in having a paid RuneScape membership. That is to say, if one person gets a paid membership to a multiplayer online game, other people in their social circle will probably be more likely to subscribe as well.
Taking advantage of this with a webapp would require that you provide something that someone either finds worthwhile showing off or something conspicuous enough that they don't have to. The second condition applied for Apple's iPod in the early part of the decade. It'd also probably be a good idea to offer benefits to groups of paid members as well as to individual paid members.
> What can freemium webapps learn from freemium games?
People want to save time so that they can spend more of it -having fun-. If your app doesn't create happiness directly, save them as much time as you can so they can get that happiness somewhere else. People will pay for this.
It is really hard to notice but on this page: http://scoutapp.com/subscriptions there is note of a 30 day free plan if you look (or search) but you don't get the same kind of information as you do on the other plans.
We also offer a 30-day free plan: 1 server, 3 plugins, and a 30 minute reporting interval.
The 1% paid signup rate, like the "1% of shareware downloaders pay", is largely a non-scientific myth created to convey the general impression that "Well, its low -- 1% sounds good, let's go with that".
I do about 2.45% on my trial signups these days and I'm hardly the most successful guy at conversion optimization in the world.
Note that I quote it as a percentage of trial signups. As a percentage of visitors it would be wildly sensitive to whatever method you are using to draw visitors to your site. If, for example, you're an early-stage startup with no significant link equity but are experimenting with an AdWords campaign, it is likely that most visitors came to your site responding to an ad which told them a) what you offer and b) sign up for the free trial. Bam, high conversion rates. If, on the other hand, you're a fairly established business with lots of link equity and a developed SEO strategy, you're going to be attracting folks across the spectrum from highly motivated to looky-loos to some poor sap looking for ["Patrick McKenzie" geologist]. (He didn't sign up for my trial. Rats?)
Of course, this rule is true for non-web-app businesses as well. Improvements in quality increase the likelihood that customers will come back, and returning customers usually have higher margins (due to lower sales & support costs) than new acquisitions.
Taking care of existing customers increases the likelihood they will refer you to their friends, thereby generating new customers. Most businesses would do well to love and leverage their existing customer base.
Wait a minute. You're telling me that if the number of people who stop paying me goes down, I make more money? NO F'ING WAY!
Seriously, is this worth writing about? You should clearly optimize all three relevant factors (traffic, conversion rates, and retention). 1% is not set in stone, and you need only get to 1.5% to get the same 50% increase.
The point he was getting across is that a 50% increase in signups leads to a 50% increase in revenue, whereas a 50% increase in retention is a 100% increase in revenue. That fact isn't immediately obviously unless you do the math.
[+] [-] sadiq|16 years ago|reply
At least, I can't see any free plans, only a 30-day trial.
I'm also intrigued by the difference in subscriber rates between freemium webapps and freemium webgames.
http://lsvp.wordpress.com/2008/06/09/successful-mmogs-can-se...
The numbers from there vary from about 5% to 15%.
What can freemium webapps learn from freemium games?
[+] [-] scythe|16 years ago|reply
Games have some advantages that can be hard for apps to replicate; games are, in general, more social than typical applications. Games are also somewhat more enviable. When I was 11, a few friends and I played RuneScape (remember runescape?). After one of us got a paid membership, everyone else suddenly got way more interested in having a paid RuneScape membership. That is to say, if one person gets a paid membership to a multiplayer online game, other people in their social circle will probably be more likely to subscribe as well.
Taking advantage of this with a webapp would require that you provide something that someone either finds worthwhile showing off or something conspicuous enough that they don't have to. The second condition applied for Apple's iPod in the early part of the decade. It'd also probably be a good idea to offer benefits to groups of paid members as well as to individual paid members.
[+] [-] teej|16 years ago|reply
People want to save time so that they can spend more of it -having fun-. If your app doesn't create happiness directly, save them as much time as you can so they can get that happiness somewhere else. People will pay for this.
[+] [-] buugs|16 years ago|reply
[+] [-] patio11|16 years ago|reply
I do about 2.45% on my trial signups these days and I'm hardly the most successful guy at conversion optimization in the world.
Note that I quote it as a percentage of trial signups. As a percentage of visitors it would be wildly sensitive to whatever method you are using to draw visitors to your site. If, for example, you're an early-stage startup with no significant link equity but are experimenting with an AdWords campaign, it is likely that most visitors came to your site responding to an ad which told them a) what you offer and b) sign up for the free trial. Bam, high conversion rates. If, on the other hand, you're a fairly established business with lots of link equity and a developed SEO strategy, you're going to be attracting folks across the spectrum from highly motivated to looky-loos to some poor sap looking for ["Patrick McKenzie" geologist]. (He didn't sign up for my trial. Rats?)
[+] [-] viggity|16 years ago|reply
[+] [-] paraschopra|16 years ago|reply
100 unique visitors => 10 free version users => 1 paid app user
[+] [-] j_b_f|16 years ago|reply
[+] [-] apsurd|16 years ago|reply
[+] [-] fjabre|16 years ago|reply
Evernote is a much better example of a freemium model.
[+] [-] mattmaroon|16 years ago|reply
Seriously, is this worth writing about? You should clearly optimize all three relevant factors (traffic, conversion rates, and retention). 1% is not set in stone, and you need only get to 1.5% to get the same 50% increase.
[+] [-] teej|16 years ago|reply
[+] [-] unknown|16 years ago|reply
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