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I think "often times" is an understatement. If you have a 3% conversion rate from your freemium users, you're doing a great job. Secondly, the people using your

by debacle 14y ago

I think "often times" is an understatement. If you have a 3% conversion rate from your freemium users, you're doing a great job. Secondly, the people using your service for free are _users_ not customers. A customer pays you. Finally, if I'm a customer and you have a freemium offering, I'm very likely subsidizing the usage of upwards of 50 other users. Is that fair?

pccampbell 14y ago
If you're making those free users work for the value their receiving (shares, referrals, etc.), then I think it's fair. Yesware is phenomenal at this, they allow you to track opens on your sent emails, but their free plan only gives you a 100 tracks/month unless you share and get others to sign up. Dropbox is the poster child of this though (spoke about it below).
- debacle 14y ago
  Yes, but then are they really freemium? I mean, I'm an eBay user but I'm not their customer (I'm their product) and I wouldn't consider myself 'freemium.'
dchuk 14y ago
3% conversion rate in this context is an empty statement. Conversion rate is entirely subjective to the product, its price, and the margins on the backend. EDIT: I agree that a non-paying customer is just a user (duh) but the goal of a product is to grow your customer base (to meet the real goal of increasing your profit). So anyone using your product for free needs to be doing so as a means to an end: Either they will convert to a paying customer at some point, or they will refer paying customers. If you're building a fun side project, free users are groovy. But if you're trying to grow a profitable company, and your free users aren't working for you in one way or another, they're just a liability.
- debacle 14y ago
  > Conversion rate is entirely subjective to the product Actually, conversion rate is completely objective - it is the percentage of users you have who 'convert' and become customers. What that means for your company might be different from product to product and industry to industry, but a 3% conversion rate for freemium is awesome.
  - dchuk 14y ago
    I suppose I was unclear, I meant the value from a 3% conversion rate for a product is subjective to that product or niche.
    - adgar2 14y ago
      That isn't what the word "subjective" means. For each market, there are objective numbers to be researched and acted upon. You mean 3% conversion being awesome "is relative to"/"varies by" a given product or niche.
      - dchuk 14y ago
        "For each market, there are objective numbers to be researched and acted upon." and "A 3% conversion rate being awesome is subjective to the niche or product" are compatible statements. EDIT: "subjective" is traditionally used when someone's opinions or biases are influencing a decision or conclusion, so I see where the confusion is here and the fault is mine for using that word. My main point is that there is no one-size-fits-all "good" conversion percentage, it's entirely dependent on the product and market.
    - nopinsight 14y ago
      I think the word you're looking for is "subject to that product...".

by debacle 14y ago

pccampbell 14y ago

If you're making those free users work for the value their receiving (shares, referrals, etc.), then I think it's fair. Yesware is phenomenal at this, they allow you to track opens on your sent emails, but their free plan only gives you a 100 tracks/month unless you share and get others to sign up. Dropbox is the poster child of this though (spoke about it below).

debacle 14y ago
Yes, but then are they really freemium? I mean, I'm an eBay user but I'm not their customer (I'm their product) and I wouldn't consider myself 'freemium.'

dchuk 14y ago

3% conversion rate in this context is an empty statement. Conversion rate is entirely subjective to the product, its price, and the margins on the backend. EDIT: I agree that a non-paying customer is just a user (duh) but the goal of a product is to grow your customer base (to meet the real goal of increasing your profit). So anyone using your product for free needs to be doing so as a means to an end: Either they will convert to a paying customer at some point, or they will refer paying customers. If you're building a fun side project, free users are groovy. But if you're trying to grow a profitable company, and your free users aren't working for you in one way or another, they're just a liability.

debacle 14y ago
> Conversion rate is entirely subjective to the product Actually, conversion rate is completely objective - it is the percentage of users you have who 'convert' and become customers. What that means for your company might be different from product to product and industry to industry, but a 3% conversion rate for freemium is awesome.
- dchuk 14y ago
  I suppose I was unclear, I meant the value from a 3% conversion rate for a product is subjective to that product or niche.
  - adgar2 14y ago
    That isn't what the word "subjective" means. For each market, there are objective numbers to be researched and acted upon. You mean 3% conversion being awesome "is relative to"/"varies by" a given product or niche.
    - dchuk 14y ago
      "For each market, there are objective numbers to be researched and acted upon." and "A 3% conversion rate being awesome is subjective to the niche or product" are compatible statements. EDIT: "subjective" is traditionally used when someone's opinions or biases are influencing a decision or conclusion, so I see where the confusion is here and the fault is mine for using that word. My main point is that there is no one-size-fits-all "good" conversion percentage, it's entirely dependent on the product and market.
  - nopinsight 14y ago
    I think the word you're looking for is "subject to that product...".