What’s the freemium business model?
Freemium is a business-model model where the service can be use for free, but limited either/both in features or quantity. Acceeding to the full service need to subscribe to a premium plan.
This business model is one of the most popular among smartphone apps or SaaS (Software as a Service) businesses. Among others : Dropbox, Mailchimp, Medium, Spotify, Slack, Github, Hubspot… are freemium apps.
Freemium KPIs
One of the key metric for freemium, is the user to client conversion rate (in %), which can be calculated by doing (number of premium client / number of free users) * 100. A good average on this KPI is between 3% to 10%, depending on your industry, your features, your product… Here : the more, the better.
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