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Thanks for the excellent point re: one-off effects. Here's how I got the 12% number: 35,000 of 300,000 non-paying accounts chose to ante up, which is 11.66%. B

Thanks for the excellent point re: one-off effects. Here's how I got the 12% number: 35,000 of 300,000 non-paying accounts chose to ante up, which is 11.66%. Based on my reporting, I think the overall conversion rate might actually be more than that. Off hand, Ning has 50,000 total paid users and an estimated 265,000 non-paying ones (though not for long). That suggest to me that 50k/315k or 15.87% of Ning customers are paying customers.

aresant 16y ago
Your numbers make sense to me. An interesting follow-up might be how they're planning to attract new communities moving forward. Freemium to is all about lead gen, they just got their revenue bump from freemium despite cutting it out of the equation - eg those 35,000 came from free accounts right? 12% is a huge closing ratio, forget for freemium. I imagine a big part of those huge conversion numbers is because the communities had ample time to gain traction, some financial incentive tied to that traction that validates the cost, etc. Let's say they convert their next 300,000 leads at the same impressive 12% ratio to paid - where do those leads come from? I applaud the move to "paid" at some levels, but I question that they're going to be able to pull it off without a solid free option - their 30 day free trial isn't going to suffice.
- taylorbuley 16y ago
  What an interesting thought, and one that only crossed my mind for a moment: What if this free-to-paid transition becomes a _tactic_? Given the traction 'free' affords, could there be a business model in switching business models?