Posts Tagged ‘Freemium Summit East’

Manymoon co-founder and CEO Amit Kulkarni used his presentation at Freemium Summit East in New York Monday, “Leveraging Other Platforms to Build a Freemium Business,” to discuss how his company was able to leverage relationships with Google Apps and LinkedIn.

Kulkarni described Manymoon as a “social-productivity tool — I know that sounds like an oxymoron to a lot of people,” adding that it brings a social element to tasks, projects, and work flows, and helps users organize information. He added that some 30,000 businesses have signed up for Manymoon.

On leveraging other platforms in general, Kulkarni said, “Platform users are starving for added-value applications. Platform users are already accustomed to the self-service model. They find us. It cuts out a lot of resources. They are also used to providing support on their own.”

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Not providing customer support for free versions of your applications “is ass-backwards,” according to Get Satisfaction founder and chief technology officer Thor Muller, who gave a presentation titled, appropriately enough, “Business Freemium Customer Satisfaction” at Freemium Summit East in New York Monday.

“Free users won’t convert or tell others if they can’t get past first wall,” Muller said, adding, “Support needs to be embedded in the product. It actually needs to be a consideration in product development. Freemium only works if customers are delighted.”

According to Muller, most application providers follow the support strategy of starting out ad hoc, followed by implementing a help desk, forums, and social support (social engagement, communities of interest, word of mouth).

He added that Mint.com took its support model public and not only dropped weekly support tickets from 6,500 to 1,500, but picked up more than 50,000 ideas on how to improve its products. Yola, meanwhile, created a customer community and placed it front and center, which was good, but the company actually responded too quickly at first and wasn’t giving customers the ability to respond to each other.

“Is it worth supporting free customers?” Muller asked. “If it isn’t worth it and you don’t make a change, then you end up creating a customer slum.”

Why create a freemium model for a paid product? Reputation Defender co-founder Owen Tripp answered that question during “Educating a Market, Freeing a Service,” his presentation at Freemium Summit East in New York Monday.

Reputation Defender was founded in 2006, and it offers a comprehensive suite of privacy and reputation tools to control publicly visible online data. Its products are used in more than 100 countries. So why explore a freemium model?

“Not enough people understand what we do,” Tripp said. “We’re not an obvious concept.” The company’s goals: “to turn heads, demonstrate irrefutable leadership, provide a path to paid in a consistent manner, and demand metrics, but don’t halt product innovation due to tracking issues. Educate through freemium models, but don’t forget that free is not a business model.”

Tripp said Reputation Defender started by inventing a lexicon, including ORM (online reputation management), and the next step was proving that people cared — partners, investors, colleagues, and even his team themselves.

Planting seeds — isolating unique pain points within the product solution — was the next step, and he cited as an example giving users the ability to opt out of junk mail, direct mail, and people search sites. Two other examples of planting seeds, according to Tripp: finding the greatest common factor — what you can use in most cases to get people to get the experience immediately — and lowering the barrier of entry to “a painfully low point,” by just asking for first and last names and email addresses.

After planting seeds comes weeding, or “tossing out ideas that don’t meet the minimum metric threshold,” and the key here, Tripp said, is making sure that you pick the right metric, adding that conversion is the wrong metric.

Finally, Tripp shared what he called his “über practical tip No. 1: For every product manager you have, hire a minimum of three designers.

“SurveyMonkey has never spent a dime on marketing or sales. We had to find a way for usage to drive conversion.” So said vice president of business strategy Brent Chudoba during his presentation at Freemium Summit East in New York Monday, “Scaling a Freemium Business — Growth and International Expansion,” in which he also detailed how SurveyMonkey expanded globally.

In a general sense, SurveyMonkey focuses on speed, simplicity, feature-richness, service, and price, with Chudoba saying, “Too many features complicates things.” The company also relied on virality, as he added, “Apps become more useful and powerful with usage and more users. Usage spreads the brand and demonstrates new use cases to potential users.”

One of the company’s biggest moves was removing the 1,000-response cap in September 2007, as incoming data was mostly text, reducing the need to worry about performance issues, and Chudoba said, “Why are we putting this artificial cap on?”

Why did SurveyMonkey go international? Chudoba pointed out that North America represents less than 15 percent of global Internet population, adding that more than 50 percent of Google’s revenue comes from international markets. He also said 40 percent to 45 percent of SurveyMonkey’s traffic currently comes from other countries — mostly from the United Kingdom, Canada, and South Africa (all English-speaking), but with the company seeing its fastest growth from Brazil, Korea, and Thailand.

He cited language, currency, and payment formats as the main obstacles to going global, saying, “Localizing the site was definitely a challenge. It was not easy to do. That was a huge thing for us. A lot of our users switched over to the other foreign-language versions.

Chudoba also mentioned accepting checks for payment as a major step, pointing out that many of the company’s users are involved in education, and “They don’t issue credit cards to teachers,” and adding, “Germany is a really hard market to penetrate for a subscription business. Only 20 percent of German business consumers pay with Visa or MasterCard.”

His closing thoughts: Think about data early; engagement drives conversion (active users are happy users); and breaking down international product barriers can dramatically increase your addressable paid user base. A great data team can uncover lots of opportunities — optimization isn’t just page testing. Let data and your user feedback guide your decisions.

A panel at Freemium Summit East in New York Monday, “When Free Isn’t Enough — Transitioning from Free to Freemium in the Consumer Space,” featured Ning vice president of business operations Anne Driscoll, SlideShare co-founder and chief technology officer Jonathan Boutelle, and HootSuite founder and CEO Ryan Holmes discussing their companies’ experiences in transitioning users from free services to paid models.

Driscoll started out by discussing the basic premise of Ning: Every group, business, and organization needs a Web site. Social has gone mainstream. Every Web site will be social. She added that Ning brings to the table creative freedom and control; seamless local integration; a robust, scalable open platform; turnkey monetization solutions; data and insights; and privacy control.

In detailing why Ning decided to transition from freemium to a paid model, Driscoll said that in April, Ning contained 325,000 networks, but the 15 percent that were paying some sort of premium represented 80 percent of its traffic. So the company reset its goal to build the very best product for its customers and align its resources to support profitability.

She went into detail on dealing with advertising, saying that it turned Ning into an über-publisher and adding, “When you run advertising, you have to do a variety of different things. You have to make sure your platform and everyone on your platform is safe. If abuse happens, you don’t get paid.”

Ning’s schedule: On April 15, it announced the end of free networks. On May 4, Ning announced new plans, as well as sponsorship plans for its educational users. On June 16, the company detailed its new revenue channels. On June 24, it revealed its partnership with Pearson, and ditto for WEGO July 19. Finally, on. July 20, it launched its Mini, Plus, and Pro plans.

Driscoll’s four takeaway points: It’s OK to ask for money if you offer a great service. You will never make everyone happy. You need huge volume or differentiated audiences to make ads work. Free didn’t enhance our product positioning

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Google Apps partner lead Scott McMullan used a panel titled “Lessons from Leaders at Scale” at Freemium Summit East in New York Monday morning to discuss how Google Apps has gone from zero users in 2007 to more than 30 million currently.

He described Google Apps as a “messaging and collaboration suite, sold to organizations and businesses,” along with Google Postini Services, pay products related to the suite.

Google Apps for Business is available in a Standard Edition, which accommodates up to 50 users and including messaging apps (Gmail, Google Calendar) and collaboration apps (Google Docs, Google Sites), as well as a Premier Edition, which has no user limit and adds features including Google Video, Google Groups, and 25 gigabytes of email storage per user.

In terms of the growth experienced by Google Apps, McMullan said it is signing up more than 3,000 new businesses daily, with a total of more than 3 million, adding that 10 million of its 30 million users are free, EDU (student) users. Google Apps has five editions (EDU, Standard, Premium, government, partner) supported by five sales teams (business development, online sales, telesales, field sales for enterprises, and field sales for federal, state, and local governments and Internet-service providers). Field sales target organizations with more than 3,000 users; telesales those with 100-3,000; and online focuses on those with 1-100.

The challenge McMullan mentioned was that the online sales team is competing with the free apps, but the bright spot: Google Apps’ diverse customer base brings more opportunity for add-ons, and its self-service DNA makes pilots easier and cheaper.

He concluded by mentioning two companies as case studies from its marketplace: Smartsheet, which has seen its conversion rate soar to three times that of pay-per-click advertising, and which has found cloud-savvy users easier to sell to and support; and SlideRocket, which has seen conversion rates of 2.5 times that of pay-per-click ads and a fivefold increase in seats per company, meaning the average company size of its buyers is larger.

Emergence Capital Partners venture partner Matt Holleran kicked off Freemium Summit East in New York Monday morning by comparing the SaaS (software as a service) market of the early 2000s with the freemium market of this decade in a segment titled, “Business Freemium — Another Decade, Another Business App Revolution.”

Holleran pointed to the client-server marketplace of the 1990s, mentioning SPSS, which was eventually acquired by IBM, as a leader; the SaaS market of the 2000s, citing Vovici; and the current environment, mentioning SurveyMonkey and calling it “the original business freemium company, starting back in 1999.”

He also strongly recommended reading The Innovator’s Dilemma, by Clayton Christensen, for insight into the disruptive business model.

Holleran described disruptive innovation as keeping apps simpler and easier to use and access, even if that means they may be less profitable, and targeting new or hard-to-serve markets with a new business model, a new financial model, and new leaders.

He mentioned targeting companies with 10 employees or fewer, pointing out that it does not make sense to serve that model with salespeople and saying, “This is where the business freemium companies are doing very, very well today and are beginning to move upmarket.”

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