7 ms·

I find Evernote's free model oddly generous and I suspect their conversion rates could be much higher with some tweaking. I use it every day and I don't come c

by aidanf 17y ago

I find Evernote's free model oddly generous and I suspect their conversion rates could be much higher with some tweaking. I use it every day and I don't come close to reaching my monthly limits. It's actually become one of my most used apps in recent months and I'd happily pay a monthly subscription for it - but the free plan is so generous I've never needed to.

lambda 17y ago
Google's freemium services, such as GMail and Google Apps, are plenty generous, and they don't really get conversion until you buy an entire institutional version (and for universities, they even give you an institutional version for free). Now, Google does also make money on ads, but the point remains that it really doesn't take a high conversion rate to get a freemium service to make money; as long as the cost per user is low enough, it can be beneficial to be very generous to your free users in order to attract a lot of people and get just a few more premium users.
- petercooper 17y ago
  In Google's case, though, it probably doesn't pay to waste time setting up systems to properly deal with small fry customers. And since the free users are being advertised to anyway, they don't miss out on much. You're right though. Someone ran the numbers on Spotify (the music streaming service). They charge $15 a month for ad-free listening or you can just use it free. Based on average listener profiles, it worked out at something as small as 1-2% of the userbase needing to pay to cover all the streaming costs involved (from what I recall).
  - rubyrescue 17y ago
    makes me think of http://sivers.org/1pct http://sivers.org/1pct - there's a number smaller than 1%...
    - petercooper 17y ago
      Heh, except Spotify is good enough that most people should be paying for it.. g Barely touch iTunes anymore and don't buy any music as it's nearly all on Spotify :-)
      - elvirs 17y ago
        the problem with spotify is that storage and bandwidth costs are nothing compared what they will have to pay labels for not suing them.

by aidanf 17y ago

lambda 17y ago

Google's freemium services, such as GMail and Google Apps, are plenty generous, and they don't really get conversion until you buy an entire institutional version (and for universities, they even give you an institutional version for free). Now, Google does also make money on ads, but the point remains that it really doesn't take a high conversion rate to get a freemium service to make money; as long as the cost per user is low enough, it can be beneficial to be very generous to your free users in order to attract a lot of people and get just a few more premium users.

petercooper 17y ago
In Google's case, though, it probably doesn't pay to waste time setting up systems to properly deal with small fry customers. And since the free users are being advertised to anyway, they don't miss out on much. You're right though. Someone ran the numbers on Spotify (the music streaming service). They charge $15 a month for ad-free listening or you can just use it free. Based on average listener profiles, it worked out at something as small as 1-2% of the userbase needing to pay to cover all the streaming costs involved (from what I recall).
- rubyrescue 17y ago
  makes me think of http://sivers.org/1pct http://sivers.org/1pct - there's a number smaller than 1%...
  - petercooper 17y ago
    Heh, except Spotify is good enough that most people should be paying for it.. g Barely touch iTunes anymore and don't buy any music as it's nearly all on Spotify :-)
    - elvirs 17y ago
      the problem with spotify is that storage and bandwidth costs are nothing compared what they will have to pay labels for not suing them.