Freemium business model

Freemium describes a digital business model where some services or content are provided free of charge while other content or more advanced features must be paid for.

The aim of a freemium model is to encourage awareness and trial of a service, so that more people convert overall. Once people have tried the free service, they are more likely to pay for enhanced features if they can see the benefits of the services and develop preference and trust for it. People can be reminded about the service as they visit other sites and access their emails and social feeds through using Ad retargeting and remarketing.

Examples of the freemium model

It is commonly used in Software-as-a-Service or SaaS platforms which are commonly used for marketing. For example, Hootsuite offers a free plan for individuals, but teams must may to collaborate and access more features.

It is also commonly used by subscription publishers. Smart Insights is an example of a freemium publisher business model. We have a free Basic membership which gives access to 20 sample guides and tools. Premium membership gives access to all resources, templates and e-learning.

About Smart Insights

Dr Dave Chaffey is co-founder and Content Director of digital marketing advice site Smart Insights. We’re a publisher and learning platform that helps our 150,000 active members in over 100 countries plan, manage and optimize their digital marketing activities by applying the actionable advice in our planning templates, guides and interactive e-learning tools.

Free members can download our free templates and benchmark their digital capabilities.