2020 was the year of free. And 2021 is the year of reaping the rewards. Let's dig into what happened when SaaS companies started to give away their products.

1. Freemium – Websites + Marketing
Freemium – 10 users free, all products
Freemium – Free community edition Lower price – 50%
discount for Starter
Suite
Freemium – Free for teams
Free trial – 14 days
Free trial – Free April
Freemium – Video meetings
Free trial – Up to 90 days
Freemium – Free for up to 5 users Freemium – Free tier Freemium – Free for teams

3. Introduced freemium in 2020
• Tested freemium as a small-scale experiment in
Spring 2020 for their Websites + Marketing product.
product.
• Have since increased the experiment to 50% of US
visitors.
• Result = Millions of new sign-ups, higher than
expected conversion.
• KPIs = sign-ups, 7-day conversion, 90-day
conversion rates.
• Freemium is a “tailwind to our business for years to
come.” – CEO Aman Bhutani
Source: https://seekingalpha.com/article/4405547-godaddy-inc-gddy-ceo-aman-bhutani-on-q4-2020-results-earnings-call-transcript

5. Added free tiers for all products in Fall
2019
• The products are “always free for 10 users”
• Now any user at an existing customer can sign
up for a free version – they don’t need admin
approval to get started.
• Result = higher TOFU, longer tail of conversion,
conversion, net revenue headwind for the fiscal
fiscal year.
• KPIs = sign-ups, active usage, adoption of new
products among existing customers.
• Free is building “a big base of customers and
potential customers underneath our business.” –
CEO Mike Cannon-Brookes
Source: https://seekingalpha.com/article/4401891-atlassian-corporation-plc-team-ceo-scott-farquhar-on-q2-2021-results-earnings-call-transcript?part=single

7. Launched free community offering in
Q3 2020
• The free product includes an unlimited number of
of users and repositories, but with limited storage (2
(2 GB) and CI/CD minutes (2,000).
• Goal was to create a a friction-free way for users to
to evaluate JFrog products before purchase.
• Result = big increase in registrations, free  sales
pipeline.
• KPIs = new registrations, sales funnel influence,
conversion from free to paid, enterprise-scale
subscriptions originating from the free offering.
• “We continue to see rapid adoption of this free
version… thousands of registrations choosing JFrog,
starting as users and then entering the sales funnel.”
– CEO Shlomi Ben Haim
Source: https://www.fool.com/earnings/call-transcripts/2021/02/12/jfrog-ltd-frog-q4-2020-earnings-call-transcript/

9. 10
Launched a 14-day free trial
• Despite an average new deal size of $100,000+, Appian
launched a 14-day free trial in 2020.
• The goal is to put the best foot forward during the “hidden”
part of the sale before a customer would usually contact
Appian.
• Result = some influence on pipeline; appears to be too early
to tell.
• KPIs = sign-ups, pipeline development
• “I think it was a really good step and… we’ve
experienced some good pipeline development as a result
of our free trial… I think it suits our situation pretty well
even though you might not have expected it from an
enterprise software vendor.” – CEO Matt Calkins
Source: https://seekingalpha.com/article/4407317-appian-corporations-appn-ceo-matt-calkins-on-q4-2020-results-earnings-call-transcript

11. Increased free trial length from 14 days to
90 days in the pandemic
• During the height of the pandemic, Shopify increased
increased their free trial length. They’ve since moved
moved it back to 14 days.
• When the trial was extended, Shopify saw a
“dramatic” increase in merchants coming to the
platform; however, that slowed toward the end of the
the offer period.
• Result = Acted like a promotion – increased sign-ups;
ups; conversion rates were high quality; likely slowed
slowed down free to paid conversion.
• KPIs = Sign-ups, free to paid conversion.
• “We will selectively deploy it going forward. We think
generally the 14 day free trial is working well.” – CFO
Amy Shapero
Source: https://www.fool.com/earnings/call-transcripts/2021/02/17/shopify-shop-q4-2020-earnings-call-transcript/

12. Offered free access to its platform during the
month of April
• Ran Free April as a campaign at the height of the
pandemic. It generated more than 1 million new user
user sign-ups (for context, they had 1.3M total
paying B2B users when they launched it.)
• Despite the free month, were able to maintain B2C
B2C billings and improve revenue year-over-year.
year. Meanwhile, it generated pipeline for the B2B
B2B offerings at a very low cost per acquisition.
• Result = Higher demand for the product, more B2B
B2B pipeline, low cost of acquisition from free leads.
leads.
• KPIs = Sign-ups, individual engagement,. B2B
pipeline generation, CAC payback.
• “It’s by far been our most successful campaign that
we’ve ever had.” – CFO James Budge
Source: https://www.fool.com/earnings/call-transcripts/2020/07/30/pluralsight-inc-ps-q2-2020-earnings-call-transcrip.aspx

13. 14
Reduced the price of its Starter Growth Suite to
$50/month
• The price was slashed by >50% from $113/month to
$50/month.
• The idea was to offer small customers all the tools they need
to grow.
• Result = record new customer growth, from 3-4k per quarter
to 8-9k per quarter.
• KPIs = new paid sign-ups, usage rates, retention rates,
upgrade rates.
• “And boy, that’s done really well. We’re very happy with
what’s going on here. Customers are signing up. They’re
being retained nicely. They’re upgrading.” – CEO Brian
Halligan
Source: https://www.fool.com/earnings/call-transcripts/2020/11/06/hubspot-inc-hubs-q3-2020-earnings-call-transcript/

15. 16
Made Cloudflare free for teams
• Launched Cloudflare for Teams in January and made it free
for any business from March until September 1.
• Claimed that “thousands of companies ranging from small
businesses to Fortune 500” took the offer; saw 75% free to
paid conversion on the product. Decided to extend the free
offer for small orgs and small teams.
• Result = Added 10,000 paying customers in Q4 2020, almost
as many as they had in all of 2019
• KPIs = Free sign-ups; free to paid conversion
• “The acceleration in paying customer growth was
primarily driven by increased new product adoption from
free to paying customers.” – CFO Thomas Seifer
Source: https://seekingalpha.com/article/4405572-cloudflare-inc-net-ceo-matthew-prince-on-q4-2020-results-earnings-call-transcript

17. 18
Introduced a free tier in July
• Introduced a generous perpetual free tier for developers in July
2020.
• Free tier includes 100 GB of data per month. This replaced
products that developers would have previously paid for.
• Result = 10x the number of developers are actively using the
product within that level of usage; saw modest downshift in
revenue from those who’d otherwise be paying; up to 1,000 free
to PAYG customers as of February.
• KPIs = Free tier adoption; developer engagement; revenue
cannibalization; conversion to PAYG customers.
• “We’re really encouraged by the early signs of success with
[the] free tier… in the first few months, we are seeing 10
times the number of developers actively engaging with the
platform at those previous couple of thousand dollar spend
level.” – CPO Bill Staples
Source: https://www.fool.com/earnings/call-transcripts/2021/02/05/new-relic-newr-q3-2021-earnings-call-transcript/

19. 20
Introduced a free tier
• Introduced a free plan in September 2020. This is meant for
small teams of 5 or fewer.
• Highlighted that they have strong gross margins, giving them
room to experiment with freemium. Freemium helps build the
brand and expand their reach.
• Result = Still in the early days (<2 months of data until the
earnings call); claim that they’re seeing “really good conversion
rates so far.”
• KPIs = Free account sign-ups; free to paid conversion; brand
awareness.
• “Our new free offering has been well received and the
number of companies benefiting from our platform, both
paid and free, grew by more than 18% over the prior year.” –
CFO Howard Wilson
Source: https://www.fool.com/earnings/call-transcripts/2020/12/04/pagerduty-inc-pd-q3-2021-earnings-call-transcript/