Thinking about freemium for B2B? Here are some challenges for you.
Here are some of my thoughts on freemium for B2B (or rather, things I would have stated to challenge you if you thought about going freemium with your B2B-only product):
- Companies are not as price sensitive as individuals. So, why have a free plan at all? Will that actually make them try your software?
- Companies are more rational when buying software than individuals. They think about stuff like total cost of ownership. If using the software has serious cost for the company, why have a free plan?
- Companies want support. Which is expensive to give when it’s a free plan.
- Companies want software that they can depend on for a long time. If a freemium software is not showing serious traction, that might derail their interest.
- Companies do not virally spread a freemium offering. Of course, employees might talk about it to others, but if the product has no value in B2C, I think your word-of-mouth will be low. (And my personal opinion is that word-of-mouth is the essential element of freemium.)
- And thus acquiring customers will be expensive. Perhaps too expensive for a free plan.
- There are far fewer companies that individuals. And freemium is all about scale. So be sure that there’s enough money and enough potential customers to actually get the upside of freemium.
- For companies there might be a sales process. Thus, it will cost you serious money to get them in. Will free get them in easier? Not necessarily.
Some might be true, some might not be — the point is, this is how I would challenge you. Answer these, and you are hopefully on your way in the right direction.
— 06 Apr 2011