8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Measuring Your FreemiumBusiness

Ranjith Kumaran

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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What youll learn today:

Your conversion rate is not too low.

Your cancellation rate is not too high.But your cost-to-serve *is* too low.

and how to tie it all together.

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Myth#1: Freemium businesses

only work if conversion rates arebetween 5%-10%

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Some real conversion metrics

~900K subscribers / 1000K active

registered (2006) = $1B market cap

~200K subscribers / ~20000Kregistered (2009) = $0.5B market cap

~180K subscribers / ~5000K activeregistered (2010)(does not include corporate or pay-as-you-go customers, see math on slide after next)

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Registered user count is a vanity

metric

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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How we measure conversion at

YouSendIt

individual subscribers + pay-as-you-go users +corporate deployments

activity (login or file send)

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Conversion dashboard #1

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Conversion dashboard #2

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Conversion dashboard #3

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Tip: how to get 100% conversion!

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Myth#2: A viable subscription

service can only churn at < 2%

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Real monthly cancellation rates

Cell phone 1%-2%

Netflix ~4%

Virus scanning ~10%

Dating sites ~15%

SaaS solutions 1%-20%

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Cancellation dashboard

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Up-sells at renewal time can lead

to negative ch

urn!

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Tips: reducing churn

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Myth#3:Cost-to-serve =

hosting costs

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Cost-to-serve dashboard

hosting costs

+ operations headcount

+ customer service headcount+ depreciation+ credit card / payment fees+

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Tip: cost-to-serve leverage can

come from scale

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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The only number that matters?

Lifetime value (> acquisition + service)

8/9/2019 A Dashboard for Freemium Providers_ What to Measure—and How Presentation

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Lifetime value dashboard

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@ranjithkumaran