More and more users are signing up every day. Traffic is consistently higher than it’s ever been. Nobody’s upgrading their accounts. I can’t blame the 1% rule for freemium businesses here; that wasn’t far from the actual upgrade rate previously, but since the new release, I’m not seeing even 1%. I can likely conclude that I’m giving away so much with the free account, there’s little reason to pay for more. So I’m brainstorming… how can I either convince more users to upgrade or monetize the free accounts?
I love this site. It’s my favorite project. Eventually I’ll find the time to do the downloaded version, and maybe some type of solution for service providers, but I would like to see some return on my time investment with the current site. If I’m going to scale to multiple servers to handle more free accounts, which involves yet more development time and hardware, there needs to be enough income from somewhere to do so.
What are my choices?
- Add advertising. How much direct revenue the advertising can bring in would determine how intrusive it needs to be — whether the main goal is maximizing impressions or convincing users to upgrade to an ad-free account.
- Lower limits. I already lowered the limit to 5,000 page views per day for the free accounts, but that is currently high enough for 99.8% of sites tracked, so even if it results in 0.2% more paying users, it’s insignificant.
- Create more artificial limits. StatCounter’s business model is largely based on this: limiting the size of the visitor log analyzed to absurdly small values. The free accounts get you 100 lines.. I’m surprised most of their users don’t even realize how little information they’re reporting on, but enough do to support their massive server farm. It also reduces their resource usage since analyzing so little data is much less intensive than what W3Counter does with more than 5,000 times more data per site.
- Send more e-mail. Bug users often enough to keep W3Counter in mind, and drive home benefits of upgrading much more often.
- Add more teasers within the interface. Have them show at login and with overlay ads like SitePoint often uses to push its books.
I’m not really happy with any of the options, but I’m also not happy with having no revenue to support continued expansion. Are there any methods I’m missing? Any less obtrusive ways to encourage upgrading? Any features that would be simple to add with the current data that would make for a good upgrade reason?
doolally
June 13th, 2007
I’d say 1+5 are your best bets 2+3 I think will hack people off, taking something away that they have already. 4 people will soon get annoyed.
1 You could do well with affiliates tailored to your users, try pusing them things like auctionads, hosting etc.
5 perhaps “see more” links on the free version that take them to a upgrade to use feature page
doolally
June 13th, 2007
Another thought w3counter must collect a lot of data could that be useful to any one?
shrock
June 13th, 2007
Don’t limit your list. There are other ways. And I understand that you would like to minimize any additional effort. Many of us spend a lot of time looking over our traffic logs. Time is money. Everyone has slightly different needs. Maybe offer your users Paid Alerts with their upgrade so they don’t have to waste so much of their time looking over their logs. Sometimes the simple things can be very valuable. Example: If my traffic takes a nose dive I’d like to know right away so I can do something about it. Another off the wall possibility might be private branding. Maybe someone would love to put their name on a private branded version and pay you money. Hang in there!
Brendon Kozlowski
June 14th, 2007
“Grandfather Clause” in the current customers. Add in a new stipulation for the free registrants that reduces their abilities significantly (perhaps a 60-day trial of the paid version so they truly know what they’re missing?). Email small and/or significant updates to the service to all users. Perhaps even run a poll (for every client) on what the most desirable feature not currently implemented would be (either from a list of your own thoughts, or those of your top clients). How difficult or easy this is depends on your implementation of an ACL.
If it were me, although I detest annoying adverts on my own sites that I want people to enjoy, people have come to expect certain limitations or annoyances for free things. If the “annoying” adverts can help you continue, even just a little, wouldn’t it be worth it?
shrock
June 14th, 2007
Another possibility would be to partner up with a domain name registrar. See if they would be willing to bundle or offer your paid version with each new domain name registration for a 60-day free trial period. After the free trial period they would be billed automatically unless they cancel.
Dan
June 15th, 2007
I like the idea of a trial of the paid version. I’d probably do it immediately upon signing up for a free account.. and have it last only two weeks or so.. it has to end soon enough that they haven’t gotten tired of checking their awesome new stats every day yet
Thanks Brendon and Josh for that idea (Josh outside the blog).
Annnoying ads, reducing features, and more e-mails are what I’d call a last resort. I’m really just planning for the future… right now load is good, I can probably fit another 1000 or 2000 small accounts on the server at least, and when you add the text ad revenue for the public site, it is doing just fine. I’m just brainstorming so I’m ready when the time comes to expand and the costs go up.
Paul Bradish
June 15th, 2007
#5 might do the trick. Use creative advertising of your premium product by including sneak peaks of features that only premium users are able to get.
PlanHQ went with the free trial method and it seems to be working out great for them - that might also be something to think about!
Sara
June 17th, 2007
Another idea might be to have coupons and implement a “get a month free” for the paid version. A couple of months ago I was looking at backpackit.com and wanted to use the paid version, but i thought, what if it sucks, I don’t want to have to pay for it even if its only $5. So i did a search for coupon codes and found a few different ones and I used one that gave me a month free. I’m happy with the service so i will continue to pay my $5/month.
Andrew
June 18th, 2007
H Dan,
I sympathise with your situtation. You made a damn nice pice of work and you’ve been good enough to allow users to sign up for free (this motivation is of course to get people involved first.)
Might I suggest a (discounted) annual subscription. I don’t know how the manage billing section works, but I would feel happier doing this business on a annual basis, as I have enough monthly things to remember as it is.
all the best,
andy
Josh Catone
June 18th, 2007
That’s a good point, Sara. 37Signals uses coupons all the time… they’re constantly running promotions where you get $x off when you upgrade, or a free month when you sign up for a new account, or combine two services, or whatever. They send out emails to current customers often about these promotions, and have for years. I doubt 37Signals would keep using a strategy that doesn’t work, so I assume that means coupons are working well for them.
oliver
June 19th, 2007
Well one of the main things that you don’t want to do is hack off your free users.
You need to analyze what you’re doing and what you need to do. One of the main things is try to get users to fill out a questionnaire, maybe run a random draw and the winner get’s a domain or hosting from you. In the questionnaire you need to ask questions like ‘why do you use w3counter’ and
‘have you upgraded’ ‘if not, what are your reasons’ that kind of thing.
Sara
June 20th, 2007
I like that Oliver. And perhaps instead of a free domain or free hosting, they get 2 months free or something as an award which may end up turning that user into a paid subscriber.
oliver
June 20th, 2007
I have been thinking, as I use the w3 counter for one of my websites, I use the free version
I’d be quite happy to host all the files for my counter on my server, maybe that could be something worth looking into? Something where users could host the main files themselves, I mean it could only be a free version but that way you’re lowering your server activity.
Dan
June 20th, 2007
oliver: There’s nothing stopping you from hosting the javascript on your own server today. I don’t want to point that out, though, since to offer new features I generally need to edit that code to track more information, and if it’s hosted on your site, you don’t get any data in those new reports.
oliver
June 21st, 2007
righto, maybe it would to be possible to get like a community based thing going with W3counter with a forum, I think having the community behind you on a project like that will make a massive difference and you could try some interesting things.
Tim
June 21st, 2007
With a free service like this, where your counter code is embedded in thousands of pages in various content niches, you could maybe sell cookies of users.
I haven’t used the service myself, but Tacoda offers to basically pay your per thousand people who downloads their cookie. They do this to offer better ad targeting for their traditional banner ads. Behavioural targeting like this could work well for you I think. Google and Amazon can behaviourally target, and Tacoda seems to be aiming to sell that ability to ‘outside’ advertisers. I am ok with it as a user personally as long as they have a strict privacy policy and the data is non personally identifiable which they say it is. Maybe there are some other behavioural targeting agencies that offer similar services?
You could continue to offer a completely free version, with no embedded cookie serving, which offers features even more restricted than now (like dropping the limit to 1,000 pageviews).
You could then offer the full version with cookie serving for free or without for a fee - depending on how much you are paid per thousand.
Sara
July 2nd, 2007
alright I’m finally signing up. Im going now. you cant talk me out of it. Yes i’m even doing a paid version. yes I will blog about it :p
Dan
July 2nd, 2007
Awesome! I sure hope I didn’t break anything with tonight’s updates then!
Ryan Williams
July 3rd, 2007
Things I think would work well are:
1. Give more incentive to upgrade without affecting the statistics logging; in other words, make the *experience* less enjoyable by putting fairly ads in the statistic viewing area that degrade the design, making sure to show people how nice it looks (and make sure it does) without them
2. Grab visitor loyalty by grandfathering them into a no-ad period for a month or few
3. Give new users a limited trial (one/two weeks) before adding the ads
I’d personally say do away with the whole multi-level pricing structure too and simply have two: free and paid. Paid gets you everything, free gets you whatever it does now.
People are going to see less value in the lesser two levels at the moment and won’t want to bother, but they’ll also see that the highest level still has limits which might be very reasonable, but are still limits.
In this case it might be best to go with the Dreamhost strategy and simply remove those limits, offering an essentially unlimited number of views and sites, and hope the majority of people don’t exceed them. And you know what? They probably won’t.
What I’d look at, anyway.
Dan Grossman » Monetization Plan for W3Counter
August 10th, 2007
[...] not taking any of the advice given, coming up with a new option instead, I don’t plan to pick any of the choices I laid out for monetizing W3Counter. Missing from that list is what I am going to do instead — add more value to the paid [...]
Becky
August 30th, 2007
I agree with a previous posted. Give users a free trial payment based on PayPal subscriptions. Let them try it free for 30 days, and set up a recurring subscription. If your service is really useful, most users won’t even think of canceling or downgrading. If they don’t find it useful, they’ll cancel and probably won’t even use the free version.
Also, I’d suggest an affiliate program for the paid versions.