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Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
Freemium Summit East Google Apps Presentation
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Freemium Summit East Google Apps Presentation

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  • 1. business freemium at scale Scott McMullan (@scottmcmullan) Freemium Summit East October 25th, 2010
  • 2. Google Apps Overview How we go to market w/freemium What we've learned about freemium
  • 3. Messaging & collaboration suite +
  • 4. In a nutshell, this our freemium
  • 5. Lots of customers, growing fast 30 Over 30M active users (10M are EDU) Over 3M businesses More than 3,000 new businesses each day 2008 2009 2010
  • 6. Rough breakdown of the 30 Million "Millions" are paid Premier 10 Million are free EDU "The rest" are free Standard/Other
  • 7. How we go to market: a) segments & sales teams
  • 8. 5 Editions
  • 9. 8 Customer segments
  • 10. 5 Sales teams
  • 11. Channel sales too! Channel +SIs +VARs +VARs +VARs +VARs Sales
  • 12. This is our freemium. Freemium Free Trial Channel +SIs +VARs +VARs +VARs +VARs Sales
  • 13. How we go to market: a) segments & sales teams b) customer lifecycle
  • 14. Send prospects to web site
  • 15. EDUs self-select
  • 16. Smaller prospects can select Standard
  • 17. Goal: start a Premier trial (or contact sales)
  • 18. Active selling done here (1) (3) (2) (4)
  • 19. That's our go to market... What have we learned about freemium?
  • 20. Focus on 3 topics 1. Why we like freemium 2. Freemium's impact on direct sales 3. Freemium's impact on channel/ecosystem, including 2 case studies
  • 21. We like freemium because... entered mature, premium market --> help disrupt large addressable market --> upsell math works existing, free consumers --> product & support leverage our apps have network effects --> lower marketing costs students graduate --> bring expectations to work we know ads --> additional revenue stream broad product --> opportunity for differentiation, add-ons
  • 22. Think "revenue layer cake" http://www.flickr.com/photos/jamieanne/4657851724/ CC-BY
  • 23. Freemium: impact on direct sales 3 Sales Teams -------------------- Field sales: > 3k users Telesales: 100 - 3k users Online sales: 1 - 100 users Freemium works because... user cap on free --> limits conflict with sales teams big diverse customer base --> more oppty to sell add-ons self-service DNA --> pilots are easier/cheaper A challenge online sales team competes with free
  • 24. 1. Revenue layer cake Think "use as directed for best results" FREEMIUM: Small biz & EDU only http://www.flickr.com/photos/rapo/2373988909 CC-BY
  • 25. Freemium: impact on ecosystem VARs Apps Marketplace ------------ --------------------------- 20% discount to VAR 20% revshare to Google Freemium works because... larger customer base --> more "air cover" --> grows appetite for consulting, apps more cloud-savvy user --> better conversion rates A challenge $50/user/year --> pressure on ecosystem prices
  • 26. 1. Revenue layer cake 2. Use as directed for best results Think "helps build multiple channels"
  • 27. 2 ecosystem case studies from Apps Marketplace
  • 28. Smartsheet.com 3X better paid conversion rates than pay per click Cloud-savvy users easier to sell/support
  • 29. Sliderocket.com 2.5X better paid conversion rates from trial 5X increase in seats/company
  • 30. 1. Create a revenue layer cake 2. Use as directed for best results 3. Helps build multiple channels Think "You'll find new ways to use it"
  • 31. Summary: freemium helped us scale 1. Create a revenue layer cake (core, add-ons, ads, ecosystem) 2. Use as directed for best results (right size, right segment) 3. Helps build multiple channels (sales teams, vars, isvs) 4. You'll find new ways to use it (awareness, preferences, ecosystem)
  • 32. Thanks! @scottmcmullan

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