The True Price of Free: What’s The Freemium Economy?
While giving away services for free may seem to be a risky move for businesses, recent data is proving otherwise. Mobile analytic firm Flurry found that freemium games generated more profit than paid games. There is a simple reason for this success, according to Phil Libin, CEO of freemium note-taking and archiving software service Evernote.
“The easiest way to get 1 million people paying is to get 1 billion people playing,” Libin said.
The basic idea of getting as many people as possible to use a service is a large part of the success of freemiums, but allowing people to get a free test drive before making a purchase is the biggest reason behind that success. Customers, however, are not willing to pay for just any old service. In particular, the infographic by Mavenlink found that customers are willing to pay for things such as unlimited services, support, add-ons and greater data storage after testing the free versions of products.