Chapter 18

Freemium

Choosing between free basic and paid premium versions

A man standing outside an enclosure of a people’s gathering in progress and peeking through a large circular hole in the wall of enclosure. An open counter with a person sitting inside is towards the right of the enclosure.

The pattern

The term ‘Freemium’ is coined from a combination of ‘free’ and ‘premium’. As this suggests, the business model involves offering a basic version of the product or service free of charge, while the premium version is made available against additional payment (WHAT?). The free version of the product is intended to permit the company to establish a large initial customer base, from which it is hoped that enough customers will later want to make the jump to the premium version (VALUE?).

A key performance indicator for this pattern is the so-called conversion ...

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