In this video tutorial I explain what is the freemium business model, and how to use either the full version of it or elements of the freemium business model in order to grow your business.
First let me explain what it is. It is a method of doing business on the web where you give something away for free (notice most websites are either fully free or mostly free) in order to get a mass of people to come to their sites and become regular visitors or users. Once people become regular visitors or users, the next part of the freemium business model dictates that there should be some way to make money from those people. The strict definition is of the freemium business model is that something basic is given away for free, and something more complex or valuable is then upsold to the people who are using the basic product. Hence the name of this concept is the combination of the words free and premium. But you don’t necessarily have to sell things to make money. The most common revenue model online is the ad revenue model. With ads, you make money from your website visitors without necessarily forcing them to buy anything.
The advantage of this approach is that you get a mass of people who come to get something for free. And while they are interacting with your product, you get to be able to show them additional marketing and sales messages in hopes of converting them to paying customers. This is the beauty is the freemium business model. Additionally, you get to take the people who come to your business in order to get something for free, and have them not come to your competitors, which helps to suffocate them and decrease their sales while increasing your sales.
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