Freemium or Free Trial?
Sefa Sarıkaya
7 replies
By definition, a free trial is a customer acquisition model that provides a partial or complete product to prospects free of charge for a limited time. Whereas freemium is a customer acquisition model that provides access to part of a software product to prospects free of charge, without a time limit.
Replies
Paul Sutton@robert_sutton1
Free trial. You want to know as soon as possible if people will give you money in exchange for your product. Money is the ultimate proof that you are on to something.
Share
Freemium can sometimes deceive an entrepreneur into thinking they have an idea worth building when in reality nobody would ever really pay for it.
On the other hand though freemium can help acquire users very fast. Nice if you need product feedback.
@philipsnyder hi Philip, I disagree that freemium deceives entrepreneurs into building something that not worth it. If their idea is good, their free product will have recurring users. If he doesn't see free users loving his product, then it's a problem of the product / market fit / niche - poor entrepreneurship.
But in case he has many free users and they are growing, there will always be the way to monetize it once the audience is big enough. Of course, there are a lot of caveats of balancing unit economics and funding for the period before the first revenue and profit, but this problem applies as well to free trial.
Unless your software is super industry specific, for example special solution for geo-engineers they can't live without, you should go with Freemium in my opinion.
I think that only Industry-specific, highly productive software can afford being Paid from the beginning, or having 7 days free trial, like Adobe does.
Remember reading that typical freemium conversion ratios are well below 10%. So, you will need deep pockets or low running costs to do freemium.
Free trial at the launch is what you need. A good way is start from Free trial and then run A/B tests to understand what your user needs. And then understanding how to proceed will come to you.
Freeem is when you know exactly what the user needs. And you need to be 100% sure that users needs it
well our app is freemium with optional membership plans, which has a short trial.
Freemium or even donations-based.
In my opinion, if the product is good enough, it's gonna strive financially. Just look at some OSS projects who are not even freemium, their completely free, yet they don't struggle with cash. Of course, you can say that it's only the best small % of open-source projects that make it to big $, but the same applies to business, right?
Since freemium and free trial are both about IT related businesses, and the most powerful tools like Linux, Git, all the programming languages and frameworks are completely free - then freemium it is.
Freemium helps build a habit or regularly using the app, free trial period doesn't provide this 'getting them hooked' mechanics.
To be honest, I'm surprised to see that 71% here chose Free Trial. It's an ancient era in my opinion.
Spotify is a great example of freemium, TeamViewer is another. Just read about these two companies, about their strategies and philosophy for pricing. Both these companies are sharks of business, but they provide their basic end-to-end experience for free to anyone - one with ads, another on personal use level. But both don't have time limitations