Freemium To Premium

Many of our clients and entrepreneurs have shared us their fear of creating a business model where the most relevant incentive for their customers is a freemium model. That's ok! It's not that simple creating a business + a product where the ROI could be seen until after 2 or 3 years of launching. The uncertainty of the business' success, finding the product-market fit, and defining a scaling business roadmap without any retribution is complicated.

In these situations building a go-to-market strategy based on the users' needs is the correct and secure method for launching a freemium business model. We talk a lot about the Product Led Model, a strategy that involves the users from the first moment and a product that presents all the functionalities that give them direct value.

So, when analyzing the data, the user behavior, and defining the functionalities that are most and least relevant for the market, the product and business can quickly iterate by creating a subscription plan. When the users fall in love with the product because they can see the value of the solution, they immediately trust new functionalities, other products, and characteristics for a better experience.

We have seen Saas products like Mailchimp and We Transfer scale within a year. Changing from a freemium model to offering the most valuable functionalities with more direct and indirect benefits into a subscription model.

During the freemium model, the product team needs to be on top of the user feedback. Make constant A/B Testing, calls, surveys, focus groups, and crossing these insights with data to determine what features and new needs the user persona has, to create the subscription model and show the direct benefits.