Someone wants to help you take your users from free to paid

Are you building a site or app that charges users? Need help?

I’m going to interview a few founders who are phenomenal at charging users and I want to ask them about your issues.

I’ll do it too.

I’m trying to figure out if I’m pushing the paid version of my site too much. So I’ll ask about that.

Want to participate?

In the comments, 1) tell your question or describe the issue you want help with, and 2) if you want me to mention your company, include its name or URL.

I’ll go first, so you can see what we’re looking for.

Share

  • http://mixergy.com Andrew Warner

    I’m wondering how I can tell if I’m over-promoting the paid version of my site. It’s pretty hard to a/b test a question like that because it affects every part of my business.

    http://mixergy.com

  • Pedro Santos

    The issue I need more help with is how to identify the right customer segment to focus on and charge to (I have 5 identified ones). 
    My company is called All-desk and the URL is http://www.all-desk.com

  • http://www.tiffinbox.org Seshu

    Do you/they recommend having a wholly FREEMIUM modeled site for a few years before offering a PREMIUM/membership site? At what point in a blog’s life does one say, “to read the rest, pay a monthly fee” or some such thing?

  • Kleine2

    Keep info private

  • Kleine2

    We are building a marketplace and for now it’s free. The challenge is how when to start charging and how much. All the people in the marketplace are change places doing currency conversions between themselves so there is no buyers and sellers in order to be able to charge only one side.

  • Encryptomatic

    I’m trying discern where the tipping piont is between free and paid.  Is something that can be measured, such as 1:5 (1 free feature to every 5 paid features).  My site Lockbin.com has for years been a free place for storing secure messages, and we spent a lot of money adding many features people requested, but the uptake of paid members is low. We would rather not scale back free any further, but… where is the tipping point, where the paid value becomes a no brainer.

  • Aj Silvers

    I would like to know the best strategy for mixing content between Free and Premium. I need to keep the free users satisfied so they return but i want to be able to offer the Premium members significant value so that they are happy to pay for the extra information.

    AJ Silvers
    http://theagileentrepreneur.com

  • Jasongaloob

    Does not feel like you are over selling the premium membership but to tell you the truth I don’t analyze your approach like I analyze others. This is probably because you won my loyalty by virtue of the honest, high value content you provide. 

  • Anonymous

    I am working on establishing an association for social media managers – http://gsmma.org . My question is how do we create content/bonuses that are worth paying for when there is so much available for free?

  • http://mixergy.com Andrew Warner

    Great freakin’ question. Thank you, Pedro.

  • http://mixergy.com Andrew Warner

    Oh. I see. I’ll talk in generalities then. The answer won’t be as strong, but I think it can be useful to you and the audience.

  • http://mixergy.com Andrew Warner

    Great question, but I think it could be clearer if you included a link.
    I’d like to give the interviewee more specifics in your case, like who the target audience is and how much is involved in being a part of the marketplace. My guess is that some audiences are easier to monetize and some actions are harder to charge for.

  • http://mixergy.com Andrew Warner

    I’ll ask.

    In my experience, by the way, I think either way would have worked, but I wish I would have charged much earlier.

    Charging sooner would have given me more experience. I’ve sold a lot of things in my life, but each audience and each product takes me experience to figure out how to sell it right.

    The other reason I wish I’d charged earlier is to set the right expectations with my audience. I want them to know that I’m not their slave, so I don’t supplicate myself for free. Charging also tells my audience that I take this work seriously.

  • Ben Paul

    I agree. You won my loyalty and as a result
    I would actually like to see you promote your paid version more!

  • Walter Heck

    I’m currently only offering a paid version of my product, since every free user will consume considerable resources. How can I figure out wether or not I want to offer a free version at all? I don’t want to offer that version, figure out it won’t be viable and then close it again. Or should I?

    My product is Tribily Server Monitoring as a Service and the site is http://tribily.com

  • Walter Heck

    Dunno where you want that link to lead to, but I doubt it is the “New Hampshire Gold Star Mothers Memorial Association”?

  • http://www.facebook.com/nathanridley Nathan Ridley

    Agree with what Ben and Jason said. Right now I only have a vague idea of what’s in Mixergy Premium. I think given all the free content you give out, and the fact that you allocate a small chunk of time to promoting sponsors at the start of each interview, it would be fair to also treat yourself as a sponsor also!

  • Quantum99

    I don’t feel like you over promote, especially compared to others out there. You offer quqlity content that I look forward to.

  • http://twitter.com/BenOnBiz Ben Welch-bolen

    Awesome, I’m working on a freemium service currently, not paid yet but it’s a concern of ours as we move to that down the road.

    Questions:
    1. When you launched did you launch with just free, or both from start? If you launched with just free did you find more or less resistance to offering paid down the road?

    2. Just more info from a wide range of people on how many plans they offered, and any tricks on where they included the upgrade options in the backend. Obviously you have to balance where you put the upgrade buttons in the backend so it doesn’t look too much like ads everywhere, so I’m curious any tips and tricks here.

    Thanks!
    Ben

  • Brian

    Andrew, you’re pulling your punches on premium. I’m a premium member and love it. (And I am a cheap bastard). You are doing your listeners a disservice by not clearly and powerfully telling us what Mixergy Premium can do for us.
    You don’t need to be apologetic; we’re all biz people here and respect good old commerce. You might want to insert a pre-recorded ad in the interview, or better yet an audio testimonial, in between interview segments. You can add the ad in post-production. This will eliminate the painful segue to self-promoting. 

  • http://twitter.com/farez farez

    What a great opportunity, thanks Andrew!

    My site, http://drupalhire.net, will open up to a closed beta audience in a couple of weeks. When it does launch properly, I would like to start charging from day 1. The service will allow members of existing communities to create job posts and skill profiles for themselves, allowing leveraging trust in existing communities to reduce cost of hiring and finding work.

    I am testing this concept out within one community first (the Drupal developer community). They are currently is in real need of an effective focal point for hiring and job searching. 

    I know that I want to charge employers but should I also be charging people who create profiles on the site?

    And are there things I need to be careful about when it comes to charging in a community that is used to everything being free and open source?

    Farez

  • http://mixergy.com Andrew Warner

    Thanks Ben.

    Hearing that helps me test the way I explain Mixergy Premium at the end of my interviews. I’m still working on doing that well. I could use the leeway you’re giving me.

  • Andrew

    I agree with the other commenters. I don’t feel like you are overselling at all. Keep up the great work. 

  • http://mixergy.com Andrew Warner

    That’s a great question!

    I know just the person to ask. I’ll see if I can get him.

  • http://www.facebook.com/profile.php?id=507496827 Richard Lucas

    The company I used to run, pmrcorporate.com has a ton of free articles and newsletters. This creates a large reservoir of people to upsell to, but we do that over the phone and face to face.  however we charge a lot more so this covers our cost of sales.
    I like the Mixerrgy approach, but don’t have time to take full advantage.  A great extra feature would be “key points in 2 minutes” or better still a written summary. I;d go for that. Richard

  • Ben Paul

    Absolutely! Thanks for the response. To elaborate a little more…. We loyal listeners wants to see you succeed, so at least for our sake, please don’t sell yourself short! :-)

  • Walter

    Totally agree with Nathan. 

    Your interviews are awesome and I will subscribe to premium when I have time to focus on my startup and work through the courses.  With that being said, I’m not really sure what I can expect from the premium section – my decision is based almost entirely on the tremendous value you provide in your free interviews, and one interview when you spoke about a course (on copywriting I think). 

    Don’t be shy to treat yourself like a sponsor – highlight how your courses help and you’ll be doing yourself and your listeners a favour. 

  • -IH

    I am no expert and have struggles of my own in the free-to-premium issue, but we tend to have more clarity when it comes to other peoples’ businesses than our own.

    I’ve actually thought a lot about the Mixergy model. If I were you, I would test the following: 

    (1) Lower the price a touch so that it’s closer “no-brainer” pricing (e.g. 9 or 14 bucks a month), and before you yell at me for telling you to lower your price, 

    (2) Have NO free videos AT ALL on the website — zero, zilch, nada.

    INSTEAD, offer the first 5 – 10 minutes of every video free before putting up your paywall – no exceptions. You already do this with your premium content — I just think you should do it will ALL your content.

    I have a hunch that the above tactic will still give you wide name recognition, continue giving new visitors a flavor of what the site is about, and may increase paid conversions because you’re asking users to take out their wallets once they’re ALREADY ENGAGED with your content. It’s very hard to say to no to paying a few bucks a month when you’re already hooked into watching a video of a tech celeb which then gets (gracefully) cut off. I’d A/B test this tactic if I were you.

  • http://bluesmoon.info Philip Tellis

    Our product is also a monitoring service (we do real user monitoring, so not competing with you), and we’ve also been undecided on whether to offer a free version or not because of the resource consumption issue.  I’d love to know how one makes this decision.

  • http://jnorthrop.me/ Jeff Northrop

    I have an e-book just about ready to go. It touches on an issue that I think is critically important to startups but gets very little attention. Since no one is really paying much attention to the issue, but I believe it is important that they do, how do I go about grabbing their attention?

    I guess the question would be how do you attract attention to a market/product/idea that people don’t know they need?

    http://startupprivacy.com

  • Chiropracticjobfinder

    This is an essential topic for all of us so thank you for bringing it up.
    1. I am not sure whether to keep  http://www.chiropracticjobfinder.com   a Free classifieds site or make people pay for postings?We do make some off advertising and am a bit concerned if we make it paid the traffic will decrease as we were setting out to be be the craigslist for Chiropractic jobs.2. Chiropractic Job Finder    http://www.chiropracticjobfinder.com

  • http://www.facebook.com/marcuskuhn Marcus Kuhn

    At http://connex.io we have a free trial instead of a freemium model for various reasons but I have started to worry that this might be hindering growth. How would they go about monetizing a business such as ours?

    We believe that freemium is difficult to make work with our business (address book management) as the limited experience a freemium user by definition gets most likely will turn the users off because it will not make him happy.

  • http://www.facebook.com/profile.php?id=515834927 David Yakobovitch

    I’m working on a start-up right now in the entertainment business that has a paywall built in.  We are including a paywall for the “quality of users” that we deem to add value to the website.  Of course, we know about tiered paywall pricing, but we are curious as to if we would alienate users and if a paywall does increase user value and quality of users long-term?

  • Mike

    Since I have already seen most of the video’s in the free section it seams there is no reason for me to buy a membership. Besides that I keep asking myself if the video’s I haven’t seen yet are going to be worth the cost. Now I know this is irrational but in the meantime while I am wondering wether or not I should buy a membership i have noticed I am loosing interest. 

    I think this might be caused by the pretty aggressive sales barrier I keep bumping into. Maybe it’s because I am from Europe but for me it’s a bit loud. Besides that it’s getting pretty confusing what is free and what is paid. This results in disappointments on my side. Also I am a bit afraid the sales barrier stays once I am on the inside.

    Then there is something else that might be of interest. I used to send friends links to specific interviews. I don’t do this anymore because I know they will probably get to it by the time the video is in the paid section. 

  • Anonymous

    As a creative this issue really weights on me as I build my new online business. Not sure if I am more sensitive or something – but I always ask myself… ” Am I being too pushy?…” Anyhow. I like that you are asking us. 
    What everyone below also applies to me – you built trust by giving a lot of value over the years. I am more prone to pay if needed. I trust you because of the time you spent giving. 
    For me I use free content and live workshops to provide value and build loyalty. Also positioning myself away from the perception of “info marketing” by using my education background and passion and using Design and Brand management to manage perception. 

  • Kleine2

    The site is in Hebrew so nobody will be able to understand it anyway. Our audience is change places (currency exchange points). Its a marketplace for cash currency exchange transactions (large sums 10s of thousands of dollars) between change places. After buying or selling dollars euros ect throughout the day they need to even out there inventory with each other. Very niche.

  • Connie Hammond

    Hey Andrew,

    My question centers around WHICH of my target audiences (if not both) should be fee-based.  I own http://www.ResortWorkers.com and could charge both the employers (to pay to find a worker) and/or the workers (who post a profile to find a job).  I currently charge workers to post a profile and let employers access profiles for free (registration required) to encourage hiring, but it could easily flop the other way.  There are pros/cons to both approaches, so I’d be curious to hear tactics/considerations when choosing which market to charge (knowing that both audiences need one another for the site to be successful).

    As for your site, I’m a premium member and have been for a while.  You provide quality content and have I’m a loyal fan. To be honest, I also paid for one interview course, but I’m not even sure that I’ve accessed any of the premium content yet in my membership (is it just that I get to access more interviews/courses?), so perhaps more delineation would be helpful or an email to existing members asking if they’re actively engaging with the premium content with a link to an overview page in case they’re not. 

    Keep up the great work!

  • Kleine2

    The users who are part of the marketplace sign up on our web site. They also install software on their desktop which gives them an unabstrusive notice when there is a new offer to but or sell a currency. This is because these transaction need to happen in real time. Right now we have 70 such users and the marketplace is just starting to pick a bit very recently with a few transactions closing in each of the last few days.

    Thanks

  • http://twitter.com/michaeloboyle Michael O’Boyle

    At the risk of encouraging an undesired change, I don’t think you are over-promoting the paid version. I would actually welcome more promotions provided they enhanced the content (by being contextually relevant) and didn’t compete with it. Short video breaks in the interview would even be acceptable provided they were limited and under 15 secs.

  • http://twitter.com/michaeloboyle Michael O’Boyle

    I also would be interested in stats and insight into the effectiveness of freemium vs. free trial.

  • Adam Worsham

    I started listening to your podcast a while ago and loved the content so much that I decided to try out your premium membership for a month. However, once I saw how much was available… and how much that is constantly being added, I’ve remained a member. It’s like having a 700+ mentors at your fingertips. I think that your earlier plugs for the membership were awkward because they came out of the blue. However I have loved the way you’ve been recently plugging it by relating a course to something you’re discussing in the interviews. Before I was overwhelmed. Now I have something to search for. There is so much value… you aren’t over-promoting.

  • http://www.facebook.com/daniel.fennessy Daniel Fennessy

    Firstly, Andrew – I don’t think you over-promote. Value is there in the Premium Membership, and it deserves to be promoted amongst all the free content you give away.

    Secondly, I’m working on an app called Party with a Local (http://app.partywithalocal.com) to be launched this summer. We are mostly focusing on the product, users & just getting v1 out there, but I’ve also been researching potential business models. Most people think it should be a free app & they wouldn’t pay someone (i.e. a local) to party with them. There are various business model options, like advertising or location-based deals, but most rely on it becoming very big, with lots of users… I’m confident it can… but this will take a lot time, effort & money to get to that point.

    But this has all just got me thinking – are we making a mistake launching a version 1 as a completely free app & waiting on monetizing? Should we have a paid version from day 1 with extra features or in-app purchases? One idea for this was to have the app free for locals but travelers have to pay to ‘unlock’ a city.

    Any feedback or ideas very welcome. Looking forward to the interviews.

  • http://mixergy.com Andrew Warner

    Thanks Jason. Fun “talking” to you on my run. ;-)

  • http://mixergy.com Andrew Warner

    Thanks. I have to keep watching it.

  • http://mixergy.com Andrew Warner

    Man, I guess these responses are really answering my question. I prob don’t even need to ask my question in the interview. 

  • http://mixergy.com Andrew Warner

    Thank you Adam! I have to read this in an upcoming interview. This means a lot to me.

  • http://mixergy.com Andrew Warner

    Thanks, Walter!

  • http://mixergy.com Andrew Warner

    Thanks. I was going to, but a past interviewee convinced me that I need to keep up my sponsorship to avoid risking my company on just membership.

  • http://mixergy.com Andrew Warner

    Oh, right. Good question.

  • http://mixergy.com Andrew Warner

    I’ll ask.

    I know Jason Fried would probably say do it on day one, but what I’m wondering is don’t you have to learn to build an app, then to get users and then to generate revenue? Aren’t each of those parts so important that they need focus?

    Good question, Daniel.

  • http://mixergy.com Andrew Warner

    Thanks.

    When I interviewed Tim Sykes, he suggested that I mention my paid version within my interviews, but when I tried it, I felt like I was distracting from the guest. But maybe there’s another way to do it.

  • http://mixergy.com Andrew Warner

    I just recorded an interview with a founder who ran a marketplace, brandstack.com . I wish I asked him this. I’ll include it in my list.

    And thanks for being a member, Connie.

    Why haven’t you gone into the courses or interviews?

  • http://mixergy.com Andrew Warner

    At one point at B&R, I stopped asking myself if I was being too pushy. I kept cramming more ads into our sites. Nothing bad happened and revenue went up. Until it didn’t.

    Since then I keep asking myself that question.

  • http://mixergy.com Andrew Warner

    Good question. And it helps a lot that you included a link.

  • http://mixergy.com Andrew Warner

    Good question David!

  • http://mixergy.com Andrew Warner

    I really could do a better job of explaining what’s free & what’s premium. Good point.

    Free: new interviews and cheat sheets. Paid: courses and interview archive.

  • http://mixergy.com Andrew Warner

    Good question!

  • http://mixergy.com Andrew Warner

    What do you think of the Cheat Sheets as summaries?

  • http://mixergy.com Andrew Warner

    I’ve gotten that suggestion before, but I can’t bring myself to making everything Premium.

    I can see what you mean though. I was interviewed by a site that did something like that. Midway through the interview, the interviewer said something like, “Thank you to all the free viewers. We’ll continue the conversation in the membership side of my site now.” I thought it was pretty effective.

  • http://mixergy.com Andrew Warner

    Brian, thank you! I have to read this in an interview. I love it!

  • http://mixergy.com Andrew Warner

    Great questions. By the way, I miss getting together with you in person.

    For what it’s worth, my answers with Mixergy:

    1) Started just free. I had a lot of resistance and confusion when I charged.

    2) I ask about the upgrade when people want to watch an old interview or when they try to access a course. But it’s not clear enough, because you didn’t know I had a Premium Membership until that night in DuPont. So I’ll ask someone who’s better at this.

  • http://mixergy.com Andrew Warner

    Thanks, Philip!

  • http://mixergy.com Andrew Warner

    Good question.

  • http://mixergy.com Andrew Warner

    Thanks. I’m not sure anyone will give us a hard number like 1:5, but I’ll ask.

  • http://mixergy.com Andrew Warner

    Sounds like you’re asking me, so I’ll tell you that I wish I’d done it right away.

    Have it up. Don’t be upset when people complain, but hear them out. Then adjust how and what you make premium.

  • http://mixergy.com Andrew Warner

    By the way, how’s the new business?

  • Shane

    Hi

    I have a virtual assistant business. It is based on monthly subscription per number of hours of support. We have trained staff overseas, we are price competitive and I have spent thousand of dollars on google Adwords, Facebook ads etc but despite the growth in outsourcing I am not seeing the conversions. It is costing me about $2k a month (loss) and that’s clearly not sustainable. I have a great team, they do god work but we’re not seeing the subscribers I need. I know the model works because my competitors do the same thing.

  • Ben Paul

    For what it’s worth, I would probably pay for a cheat sheet. I almost feel like their value is lessened when you offer them for free. And anyways, I think it’s reasonable for people to pay for a “shortcut” that makes things easier for them (i.e., they don’t need to listen to the whole interview if their goal is to cut to the chase).

  • Shane
  • http://noahfleming.com/ Noah Fleming

    This is a great comment thread.
    I have thoughts for premium but need to come back to DC to discuss. Can’t believe I missed you!

    Ever come Detroit/Toronto way?

  • http://noahfleming.com/ Noah Fleming

    These are great answers. Ben makes a solid point. Your listeners want to see you succeed. It’s your community.

  • http://noahfleming.com/ Noah Fleming

    Also a great answer – one of the most important things is showing your premium members how to get more value out of what’s already here. It’s a very full closet.

  • http://noahfleming.com/ Noah Fleming

    Paid needs further ways to engage and learn from the content already here, not necessarily more.

  • Ben Paul

    Seeing these 72 comments, I’m wondering if start-up founders would pay Mixergy to get their specific, personal issues answered by the kind of start-up all-stars you have connections to.

    People could type up their question and Mixergy would track down advice from those who are in a position to answer it.

    Kind of like the end of this interview,
    http://www.startuplessonslearned.com/2011/11/that-old-time-startup-religion.html, where founders come to Eric Ries with their ailments and he heals them. Just a thought.

  • http://noahfleming.com/ Noah Fleming

    Do you mean competing with info people will get for free on the net?
    Those people have no intention on paying. It’s not worth the effort trying to convert otherwise.

    As Gary Halbert used to sell “sell to the foxes, not the dogs”

  • http://noahfleming.com/ Noah Fleming

    This is right on the money Andrew. It has a lot to do with setting the right customer expectations. The idea about moving the free line and giving away loads of free to build a paid business “eventually” is backwards. The free content should be the proving ground to support the value found in the paid content. 

  • http://noahfleming.com/ Noah Fleming

    The tipping point is dumping the free version!

  • http://noahfleming.com/ Noah Fleming

    Jeff – cool book. Can you offer a ‘just do it for them’ option? Can you offer consulting to ensure they are compliant?

  • http://noahfleming.com/ Noah Fleming

    How have you segmented the 5 groups you’ve identified?

  • http://noahfleming.com/ Noah Fleming

    What are the competitors sites?

  • Shane

    Competitors would be sites like taskseveryday.com, asksunday.com and odesk.com

  • http://jnorthrop.me/ Jeff Northrop

    Unfortunately (fortunately) I have a full time job, so consulting isn’t something I want to get into, but that’s a clever idea.

    P.S. If you’re interested in a pre-release copy of the book, let me know. I’d be glad to send one along. You can contact me jeff at jnorthrop.me.

  • http://www.facebook.com/marcuskuhn Marcus Kuhn

    Posted a related question above. Would be very much interested in this too as we have to make a decision in that regard soon.

  • http://www.thewellnessschool.com/ Carrie

    We have a membership site that helps holistic practitioners grow their practices. We offer video tutorials, interviews with professionals all across the US, and product they can reuse in their own practice. Membership is reasonable and we have people signed up for the “free” newsletter and gifts, but only a few takers on the paid membership. The site is http://www.thewellnessschool.com

    carrie

  • http://twitter.com/farez farez

    Adam’s journey above pretty much mirrors mine too. My problem now is to find time to go through the tonnes of amazing interviews on Mixergy Premium!
    One thing I’m still not clear about is what’s actually free and what’s premium because when I go on to the site the free stuff is just as good as the premium stuff, and there isn’t anything on the page to say what I’m about to watch is premium or free content. But it didn’t matter anyway because all I cared about was clicking in Play.

    The podcasts are great too as I use travel time to listen to them sometimes. But again, I’m not sure if what I’m listening to are free or premium content. 

    I’m a loyal fan, Andrew. And I’m addicted to Mixergy!

    Farez

  • http://mixergy.com Andrew Warner

    Painful that we missed each other.

    How about a Skype call on Monday morning? How’s 10am?

  • Alain Lesage

    This is indeed an interesting experiment and, seeing all this participation, it obvioulsly work. Well done!

  • http://twitter.com/fbliss Fred Bliss

    Hi Andrew,

    I’m not quite ready to ask these questions since my subscription site is not quite up and running. I did have a thought for you though regarding Mixergy. What I think would be a great idea would be to offer 7-day passes to Mixergy.  Someone like me, I can’t afford a monthly recurring charge even though the value is clearly there.  I think you’re missing a lot of potential revenue in the segment like me that loves and values mixergy but maybe just isn’t quite ready to commit to $300/year.  Also, people that you can get your toe in the door with by having them get a 7-day taste of what mixergy premium is like will become low-hanging fruit for monthlies later.  It really gives you the best chance to convert them.  I’m not sure what your COA is on each current 12-month premium subscription, but I would be willing to bet it would go down once you put a 7-day plan up for sale.

  • http://mixergy.com Andrew Warner

    Are you free for a Skype call today? How’s 3pm Eastern?

    Looks like you didn’t see my response to your comment with a suggestion that we talk today @ 10am, so I thought I’d try another option.

    ————————-
    Andrew Warner < http://AndrewWarner.com>
    Founder,
    http://Mixergy.com

    nyc2003

  • http://noahfleming.com/ Noah Fleming

    Sorry man. Monday I’m always on full-blown daddy day care. I can do a call Thurs/Friday of this week.

  • http://mixergy.com Andrew Warner

    How’s 10am on Friday?

    By the way, that last comment was an accident. I meant to send it to you via email, but I guess I used the disqus email address instead of yours.

  • http://noahfleming.com/ Noah Fleming

    10am EST Friday on Skype…. Coffee.