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← Kevin Hale Advice App Monetization Udacity

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Showing Revision 2 created 05/25/2016 by Udacity Robot.

  1. I guess one question I think I always
    have to talk to people about is
  2. when does freemium sort of make sense?
  3. Or what is the advantage
    of going with freemium and
  4. how is it different from
    other typical models?
  5. And then why is it good for
    a subscription software company?
  6. The reason you approach freemium
    is because the idea is, one,
  7. you approach your free users
    as if they're lead generation.
  8. And that they're part of your
    marketing side of the equation,
  9. like these people are the ones who
    can get the word out on there.
  10. And the most important thing that
    you should be aware of is like.
  11. Is the market large enough that
    a small conversion of those people
  12. using the product is enough
    to make the company large?
  13. So for example, a local bakery can
    only serve people within a small area,
  14. their potential market
    size is a lot smaller.
  15. So you can't just give ton away for
  16. free because that conversion rate
    won't make that business sustain.
  17. But when you have an internet
    software company.
  18. The marginal cost of replication
    of offering services is very,
  19. very cheap and the potential
    size of the market is huge,
  20. because it's the whole world,
    everyone on the Internet and
  21. those forms are big enough,
    like all of the use cases for it.
  22. If you have a software
    that is very niche, and
  23. that the cost of each new user or
    free user is extremely high,
  24. you want to rethink maybe
    the mechanics of using freemium.
  25. Like, it's not a one size fits all for
    every company.