August 02, 2019

Freemium/Premium vs. Try/Buy

by Stijn Hendrikse

Offering your prospects a Trial/Buy option does not have to conflict with a Freemium/Premium model. It can get confusing though.  What to use when?

Freemium/Premium is ideal if you are servicing a large market with prospects who are interesting in capabilities that they can get from many vendors (this blog helps with this analysis). In this case, you want a Freemium offer to help you "catch" this audience. By providing a great experience, and differentiating your Premium offer with compelling features, you can then upsell.

For Freemium models, it's important to understand your "Cost to Service" so you don't sign-up for a commitment to free users that becomes too costly for you over time.

A Trial/Buy model works well if you can convince your prospects to pay after they've used your premium features for a limited time. Make sure to pick the right Trial period. If there is no reason to have a perpetual freemium offer in your market, I recommend picking between Trial and Freemium. Having both can get confusing and hard to maintain.

Stijn Hendrikse

After 15 years of experience in the Software Marketing Industry, Stijn adopted the SaaS model to launch Kalungi, a SaaS Chief Marketing Officer blog where he shares best practices. This supports his work as a CMO Consultant with Chief Outsiders.

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