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Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)
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Freemium ain't new. It's just a new word. (Freemium Summit Presentation, Matt Brezina, Xobni)

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This is a slide deck I presented at Freemium Summit on March 26, 2010. An exploration of existing freemium businesses, business/market conditions where freemium can make sense, and finally some …

This is a slide deck I presented at Freemium Summit on March 26, 2010. An exploration of existing freemium businesses, business/market conditions where freemium can make sense, and finally some lessons learned from xobni

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  • $9M operating budget
    1.3 from tea gardens
    400k from gold course
  • $9M operating budget
    1.3 from tea gardens
    400k from gold course
  • $9M operating budget
    1.3 from tea gardens
    400k from gold course
























  • we planned freemium from day 1. We said, let’s us go out and solve a problem for all of these really really valuable business users. And we’ll sell them a lot of stuff in the future
  • we planned freemium from day 1. We said, let’s us go out and solve a problem for all of these really really valuable business users. And we’ll sell them a lot of stuff in the future
  • we planned freemium from day 1. We said, let’s us go out and solve a problem for all of these really really valuable business users. And we’ll sell them a lot of stuff in the future
  • we planned freemium from day 1. We said, let’s us go out and solve a problem for all of these really really valuable business users. And we’ll sell them a lot of stuff in the future
  • we planned freemium from day 1. We said, let’s us go out and solve a problem for all of these really really valuable business users. And we’ll sell them a lot of stuff in the future









  • tod sacerdoti
    made a competition in the company to guess the order of top upsells







  • andrew chen’s blog list of things to a/b test. I”ll be adding to his list on my own blog shortly.

    YOu are doing such high volumes of impressions, it is probably more important in freemium than anywhere else





  • dan airely example of duke basketball tickets. 15x difference in value.



  • Transcript

    • 1. Freemium ain’t new It’s just a new word Matt Brezina Co-founder, Xobni Twitter: @brezina mattbrezina@gmail.com
    • 2. efax (J2 Com) 1B market cap • 9,9M free users • 1.2M premium users
    • 3. Skype 1.9B market cap efax (J2 Com) 1B market cap • 27B free min • 9,9M free users • 3.1B premium min • 1.2M premium users
    • 4. Skype 1.9B market cap efax (J2 Com) 1B market cap • 27B free min • 9,9M free users • 3.1B premium min • 1.2M premium users LogMeIn 450M market cap • 300k premium users • 27M total registered users
    • 5. 10:1
    • 6. $
    • 7. $ $
    • 8. $ $ $
    • 9. Free - the most powerful word in marketing
    • 10. Free - the most powerful word in marketing • Freemium is a marketing strategy
    • 11. Free - the most powerful word in marketing • Freemium is a marketing strategy • Powerful because of the “penny gap.”
    • 12. 1. Is freemium right for my business?
    • 13. 1. Is freemium right for my business? 2. If it is, how do I make it successful (lessons learned from Xobni)
    • 14. If you make software, you can make money in four ways If you sell software to a business, they don’t want you to make money the last two ways
    • 15. If you make software, you can make money in four ways • Sell your stuff (Premium only) If you sell software to a business, they don’t want you to make money the last two ways
    • 16. If you make software, you can make money in four ways • Sell your stuff (Premium only) • Sell your stuff to some of your users (Freemium) If you sell software to a business, they don’t want you to make money the last two ways
    • 17. If you make software, you can make money in four ways • Sell your stuff (Premium only) • Sell your stuff to some of your users (Freemium) • Sell other companies’ stuff (Advertising) If you sell software to a business, they don’t want you to make money the last two ways
    • 18. If you make software, you can make money in four ways • Sell your stuff (Premium only) • Sell your stuff to some of your users (Freemium) • Sell other companies’ stuff (Advertising) • Sell users’ stuff (Data marketplace) If you sell software to a business, they don’t want you to make money the last two ways
    • 19. If you make software, you can make money in four ways • Sell your stuff (Premium only) • Sell your stuff to some of your users (Freemium) • Sell other companies’ stuff (Advertising) • Sell users’ stuff (Data marketplace) If you sell software to a business, they don’t want you to make money the last two ways
    • 20. If you make software, you can make money in four ways • Sell your stuff (Premium only) • Sell your stuff to some of your users (Freemium) • Sell other companies’ stuff (Advertising) • Sell users’ stuff (Data marketplace) If you sell software to a business, they don’t want you to make money the last two ways
    • 21. Is freemium right for my business? (let’s narrow discussion to freemium vs. premium only)
    • 22. When freemium makes more sense than premium-only
    • 23. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist
    • 24. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist ✓ Corollary: channels for buying users are too expensive
    • 25. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist ✓ Corollary: channels for buying users are too expensive ✓ Premium-only competitor is creating demand
    • 26. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist ✓ Corollary: channels for buying users are too expensive ✓ Premium-only competitor is creating demand ✓ Your product has (or needs) network effects
    • 27. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist ✓ Corollary: channels for buying users are too expensive ✓ Premium-only competitor is creating demand ✓ Your product has (or needs) network effects ✓ Cost to offer free service isn’t too high
    • 28. When freemium makes more sense than premium-only ✓ A channel for buying users doesn’t exist ✓ Corollary: channels for buying users are too expensive ✓ Premium-only competitor is creating demand ✓ Your product has (or needs) network effects ✓ Cost to offer free service isn’t too high ✓ You can get $ to build free product
    • 29. How to make freemium a success (lessons learned from Xobni)
    • 30. How to make freemium a success (lessons learned from Xobni) Paul Buchheit: advice = limited life experience + overgeneralization
    • 31. Why did we go freemium with Xobni?
    • 32. Why did we go freemium withwith Xobni? Why did we go freemium Xobni?
    • 33. Why did we go freemium withwith Xobni? Why did we go freemium Xobni? ✓ Good virality on communication platform
    • 34. Why did we go freemium withwith Xobni? Why did we go freemium Xobni? ✓ Good virality on communication platform ✓ No existing cheap paths to buy Outlook users
    • 35. Why did we go freemium withwith Xobni? Why did we go freemium Xobni? ✓ Good virality on communication platform ✓ No existing cheap paths to buy Outlook users ✓ Low marginal cost per user
    • 36. Why did we go freemium withwith Xobni? Why did we go freemium Xobni? ✓ Good virality on communication platform ✓ No existing cheap paths to buy Outlook users ✓ Low marginal cost per user ✓ Access to VC funds
    • 37. Why did we go freemium withwith Xobni? Why did we go freemium Xobni? ✓ Good virality on communication platform ✓ No existing cheap paths to buy Outlook users ✓ Low marginal cost per user ✓ Access to VC funds ✓ We didn’t want to sell enterprise software
    • 38. Xobni Plus
    • 39. Xobni Plus Xobni for Blackberry
    • 40. Xobni Plus Xobni for Blackberry Xobni One
    • 41. Xobni Plus Xobni for Blackberry Xobni Enterprise Xobni One
    • 42. Xobni Free for Outlook
    • 43. Xobni Free for Outlook
    • 44. Free Premium Xobni Free for Outlook
    • 45. Free Premium Xobni Plus Xobni Free $29.95 for Outlook
    • 46. Free Premium Xobni Plus Xobni Free $29.95 for Outlook Xobni Enterprise $36/user/yr
    • 47. Free Premium Xobni Blackberry $9.99 Xobni Plus Xobni Free $29.95 for Outlook Xobni Enterprise $36/user/yr
    • 48. Free Premium Xobni Blackberry $9.99 Xobni One $3.99/mo Xobni Plus Xobni Free $29.95 for Outlook Xobni Enterprise $36/user/yr
    • 49. Free Premium Xobni Blackberry $9.99 Xobni One $3.99/mo New mobile & email Xobni platforms Plus Xobni Free $29.95 for Outlook Xobni Enterprise $36/user/yr
    • 50. 8 Lessons learned in building Xobni’s freemium business
    • 51. 1. Survey! One huge advantage of free - you’ve got a lot of users to talk to Decisions we made because we understood our users: • Deployed by IT? Our policy doesn’t allow deployment without Xobni Enterprise • One or multiple computers? Extra Xobni plus licenses are $9.95
    • 52. 2. Start with more in-product upsells than you are comfortable with • See what users are clicking on • Determine which upsells convert to sales • Improve or remove
    • 53. Over 14 in-product upsells
    • 54. 3. Tease with data Show the user what they are missing from your premium product
    • 55. Why should I click that button?
    • 56. Tease with data Text
    • 57. 4. Tie message to the user’s action If the user tells you he wants apples, don’t sell oranges
    • 58. I clicked Video So, sell me video!
    • 59. User clicks on autosuggest We sell them autosuggest
    • 60. 5. Obviously, A/B test • High volume in freemium businesses makes a/b testing more important than ever • We got 50% improvement in premium conversion by a/b testing our in-product upsells and messages
    • 61. 25% improvement on this upsell
    • 62. 6. Not all channels are created equal (and that can be okay)
    • 63. 7. Users conditioned to free product convert poorly to premium • Existing free users converted poorly when we launched premium • New users that only see Xobni Free when installing convert poorly
    • 64. Users that see a homepage with only our free product
    • 65. Convert to premium more poorly than users who see both free and premium initially
    • 66. 8. Free trials are the freemium business’s best friend Cost of losing X is perceived higher than the value of gaining X
    • 67. 1B market cap 1.9B market cap 450M market cap
    • 68. 1B market cap 1.9B market cap 450M market cap Time will tell...
    • 69. Freemium ain’t new It’s just a new word Matt Brezina Co-founder, Xobni Twitter: @brezina mattbrezina@gmail.com

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