Welcome!

Agile Computing Authors: Liz McMillan, Zakia Bouachraoui, Yeshim Deniz, Elizabeth White, Pat Romanski

Related Topics: @CloudExpo, Agile Computing, SDN Journal

@CloudExpo: Blog Feed Post

Six Ways to Turn Freemium into Premium By @AriaSystemsInc | @CloudExpo [#Cloud]

The conversion rate is all over the boards when transforming free into premium services

“Free” reigns supreme when it comes to online marketing. But “pay” is more profitable to your bottom line. In the popular Freemium world of digital offerings, where free and premium content or services are offered, it’s prudent to consider how you will transition free offerings into paid subscriptions before you actually take that leap.

The conversion rate is all over the boards when transforming free into premium services. Industry averages have been reported anywhere from 0.5% to 5%. When it comes to profit, that’s a huge range.

Customer-IO-Free-To-Converted-Rate

Here are six factors to smartly monetize your products when you make that move:

  1. A smooth transition

For best results, treat customers with respect and communicate upcoming changes from free to subscription or premium offerings. It’s important you don’t make dramatic, unannounced moves. Be sure you provide and outline strong reasons why customers should continue to use your product or service. At the same time, be transparent about premium pricing. Don’t hide pricing details behind a pricing link or tab.

  1. Make your free plan good, but not too good

It’s a delicate balance. You want to give customers enough free and easy to use products to keep them coming back for more. And you want to limit access to even better products that are so awesome folks are willing to pay for the extras. Give away too much, and customers see no reason to upgrade. But if your freemium offerings don’t give them enough, they won’t even bother with you from the start.

  1. Align conversion around features that drive repeat usage

Your first goal should be to build a large audience, then monetize it. Identify what is making users come back time and time again. And leverage that understanding so paid features best serve your clients’ needs and show them why they need your product or service. You should also consider a trial period as it encourages people to opt in and allows them time to become addicted to your product.

  1. Understand metrics

Use Key Performance Indicators (KPIs) to gauge success. KPIs offer great insight into performance and let you see what’s working well or not at all, allowing organizations to see what improvements are needed. KPIs should also be actionable – only measure something you can actually change by creating new actions. For example, measure page views not only too see how the overall performance of your site is doing, but also to gain insight into which pages are performing best. The pages with the most views let you know what features of your free product customers use most or what potential customers are interested in so you can promote those features in a premium version.

  1. CLV and customer billing

Customer lifetime value (CLV) is a prediction of the net profits that can come from a long-term relationship with a customer and can also be defined as the dollar value of a customer. CLV is extremely important in converting free users into long-term paid subscribers. To accomplish this, offer products or services that have enough value users are willing to pay for them. Design your customer billing in a way that makes transactions for premium and recurring offers easy. An effective customer billing system will manage all of your billing activates in one place, at one time, without the need to recreate processes if and when your customer upgrades to a paid subscription.

  1. Privacy and Security

In today’s digital age, concerns over security can slow down, and even stop, conversion rates. Consumers have to trust your security, whether you are offering something for free or requiring payment to access content. Can you guarantee their personal information will be secure and not shared with others? Safe cloud billing is necessary for any business looking to upgrade free services to paid or recurring subscriptions.

Once you’ve enacted these six steps, you still need to market, track metrics and continually improve your site in order to turn freemium customers into premium customers. Keep providing features that make their experience safer, give visitors content they find valuable and are willing to pay for, and make your premium packages worth their while by offering valuable services unavailable to free users.

And be relentless in your strategy to convert freemium users to premium users. Use emails, snail mail if appropriate, and even phone calls to engage your audience.

Marty Orgel

The post 6 Ways to Turn Freemium into Premium appeared first on Recurring Revenue Blog | Aria Systems.

Read the original blog entry...

More Stories By Aria Blog

The Aria blog is the place for news, commentary and discussion on monetization, agile billing and IoT. We cover a variety of topics including forces of market disruption, the Monetization of IoT, billing best practices, trending news and what monetization will look like in the future. Our hope is that you’ll become better informed, be entertained and in turn share your thinking, ideas and comments.

IoT & Smart Cities Stories
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
Nicolas Fierro is CEO of MIMIR Blockchain Solutions. He is a programmer, technologist, and operations dev who has worked with Ethereum and blockchain since 2014. His knowledge in blockchain dates to when he performed dev ops services to the Ethereum Foundation as one the privileged few developers to work with the original core team in Switzerland.
René Bostic is the Technical VP of the IBM Cloud Unit in North America. Enjoying her career with IBM during the modern millennial technological era, she is an expert in cloud computing, DevOps and emerging cloud technologies such as Blockchain. Her strengths and core competencies include a proven record of accomplishments in consensus building at all levels to assess, plan, and implement enterprise and cloud computing solutions. René is a member of the Society of Women Engineers (SWE) and a m...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
Dynatrace is an application performance management software company with products for the information technology departments and digital business owners of medium and large businesses. Building the Future of Monitoring with Artificial Intelligence. Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more busine...
Whenever a new technology hits the high points of hype, everyone starts talking about it like it will solve all their business problems. Blockchain is one of those technologies. According to Gartner's latest report on the hype cycle of emerging technologies, blockchain has just passed the peak of their hype cycle curve. If you read the news articles about it, one would think it has taken over the technology world. No disruptive technology is without its challenges and potential impediments t...
If a machine can invent, does this mean the end of the patent system as we know it? The patent system, both in the US and Europe, allows companies to protect their inventions and helps foster innovation. However, Artificial Intelligence (AI) could be set to disrupt the patent system as we know it. This talk will examine how AI may change the patent landscape in the years to come. Furthermore, ways in which companies can best protect their AI related inventions will be examined from both a US and...
Bill Schmarzo, Tech Chair of "Big Data | Analytics" of upcoming CloudEXPO | DXWorldEXPO New York (November 12-13, 2018, New York City) today announced the outline and schedule of the track. "The track has been designed in experience/degree order," said Schmarzo. "So, that folks who attend the entire track can leave the conference with some of the skills necessary to get their work done when they get back to their offices. It actually ties back to some work that I'm doing at the University of San...
When talking IoT we often focus on the devices, the sensors, the hardware itself. The new smart appliances, the new smart or self-driving cars (which are amalgamations of many ‘things'). When we are looking at the world of IoT, we should take a step back, look at the big picture. What value are these devices providing. IoT is not about the devices, its about the data consumed and generated. The devices are tools, mechanisms, conduits. This paper discusses the considerations when dealing with the...