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On Converting Free
   Users to Paid Users
               Kevin Hale


Future of Web Apps · Miami · Feb 23, 2009
particletree.com
treehousemagazine.com
wufoo.com
150,000+
1.3 million+
  2 million
 15 million
Individuals, Developers,
 Designers, Non-Profits,
  Teachers, Students,
 Universities, Research,
 Real Estate, Marketing,
Healthcare, Banks, SMBs
Why are you here?
Freeloaders
Overcoming the
 Power of Zero
Interest
No Alternative
  Urgency
Convenience
Peer Pressure
   Novelty
    Status
What about software?
When copies are free,
you need to sell things which
     cannot be copied.
What can’t be copied?
Trust
Immediacy
Personalization
 Interpretation
  Authenticity
  Accessibility
  Embodiment
    Patronage
   Findability
Maximizers vs Satisficers
Best Price
    Best Product
Best Overall Solution
Excercise 1
Immediacy
Personalization
 Interpretation
  Authenticity
  Accessibility
  Embodiment
    Patronage
   Findability
You make
what you measure.
Point




Point
End




Start
Count
Log = Action + Timestamp
Action
  Timestamp
    Referrer
  IP Address
Cookie / Session
  Server Data
  Client Data
Views
  Clicks
 Submits
Keystrokes
Positive / Negative
   Likert Scale
      Ratings
 Multiple Choice
 Open Feedback
The Ultimate Question
Tools
google.com/analytics/
web.analytics.yahoo.com
omniture.com
haveamint.com
crazyegg.com
clicktale.com
wufoo.com
surveymonkey.com
formassembly.com
dabbledb.com
google.com/talk/
service/badge/New
Excercise 2
Your Economic Engine
Benchmarks
Web App
Autopsy
 SXSW 2007
PHP

6 months to launch

Launched : July 2006

    3 Employees
Ruby on Rails

3 months to launch

Launched : July 2005

    6 Employees
Java

   5 months to launch

Launched : February 2004

     ~30 Employees
regonline
       .NET

 3 years to launch

 Launched : 1996

  50 Employees
Conversion per 100 Visits
               Free         Paid

              7.00%         1.00%

              11.00%        1.00%

              8.00%          N/A

regonline     1.52%         1.14%
Shareware
  0.5%
Dropsend
 1% - 2%
Casual Download Games
         2%
Other Freemium Services
  Range from 1.5% to 5%
Average Overall less than 3%
Ning
3%
Flickr
5-10%
AdultFriendFinder
   10% - 22%
Habbo : 10% of players
Club Penguin : 25% of uniques
Runescape : 16.6% of uniques
Puzzle Pirates : 22% of players
Top 10
TurboTax Online
     70%
Things to Keep in Mind
Seasonal Effects
Best     Worst

             Mar      Dec

             Jan      Dec

            Jan/Feb   Dec

regonline    Sept     Dec
Early Adopter Frugal Factor
7,000 invitations sent
     to potential Beta Testers.

 Only 3,500 created an account.

Only 50 of them became customers
  (and we o ered them half o ).
Moving the Needle
The Funnel
Reduce Friction
Number of Steps
Label Placement
Multiple Columns
Excercise 3
Increase Awareness
Excercise 4
On Promotion Codes
Successful Changes
regonline
     Powered By Logo
339% increase in click through

   Video Spokesperson
11% increase in registrations

   Why Register Online?
 6% increase in registrations
Customer Lifetime Value
Customer Referral Value
The Original
The Winner
Excercise 5
Off the Funnel
Best Price
    Best Product
Best Overall Solution
Relationships
as a Metaphor
Intimacy       Passion




      Commitment
Nonlove
       Liking
  Infatuated love
     Empty love
   Romantic love
Companionate love
    Fatuous love
 Consumate Love
Intimacy       Passion




      Commitment
Existing Users :: Marriage
Dr. John Gottman
Everyone fights.
Money    Cost / Billing
  Kids   Users’ Users
   Sex   Performance
 Time    Roadmap
Others   Others
How it’s done.
When Things Go Wrong
Enlightened Hospitality
Importance of Fun
Keeping the Romance Alive
Bibliography
Questions?
Thanks!

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