The concept of Freemium is giving out services or products for FREE and trying to make money out from it. According to Wikipedia, Freemium business model was created by venture capitalist Fred Wilson back on 23rd March 2006. Freemium business model is often used online either by companies or individual bloggers. I suppose most of us who are trying to make a profit by blogging can be consider as a Freemium business model. We give out free information service to attract lots of visitors and make money out of it.
Free information service or creating informatics content is the most popular way for bloggers to attract visitors. That’s the basic and must do for bloggers. In order to make blogging into a successful money making opportunities, writing good unique content might not be enough. In the case of Freemium business model, John Chow of John Chow dot Com plays the game successfully. He started out his blog as a hobby or a place to write about his interest but soon transform the blog into a money making opportunities. One of his methods of attracting visitors is giving out FREE stuff like eBooks, coupons, WordPress theme, Ipad, Iphone ,Blog hosting, T-shirt and many more. Search for the word FREE using the search engine at his blog and you’ll get tons of post which he gives out lots of stuff. In return of the FREE stuff given away, his blog gains lots of visitors or traffic. Once there is huge amount of traffic, he is able to convert it into revenue and more traffic by selling products, gaining backlinks and advertising. This is a typical Freemium business model for blogging. The blog provides free information and lots of other free stuff. Charges apply if visitors wish to purchase advertising service either by blog post or banners. Still this is just one of the many methods the blog make money.
Another good example of Freemium business model is Skype. The company started by providing free P2P calls online from computer to computer. As the number of Skype user increases, the company launches plan involves calling from computer to regular home phone and cell phone. Although charges apply to latest plan of calling from computer to regular home phone and cell phone, people are willing to pay for it as an upgrade or additional service from Skype. Given the large amount of user within Skype, It takes less than 10% conversion to make a profit. One other popular online network community also uses Freemium business model to cash in big money. Yes, it’s the FaceBook and particularly the online game feature FarmVille. Players are free to sign up and free to play the game. Players can only do so much unless they purchase the virtual items. No doubt players can continue to play for FREE but if they can spend little bit of money, the game becomes more exciting and fun. Thus the game banks in a great deal of money.
There are a lot of online company and website using Freemium business model but not all of them have a successful result. But still we can sense that Freemium business model is no doubt the best way to start a business online. I’m sure you can find lots of company or website which is similar with the examples I explain above. They might not be that popular or famous but still they are able to survive and make a profit providing their FREE services. As for us bloggers, we can take John Chow as an example for Freemium business model and practice the same method used. In order to accomplish the Freemium business model money making opportunities, there are some criteria that we should think about and take note.
- What are the FREE stuffs we can provide?
- The cost for maintaining the blog or business and that includes the FREE stuffs.
- How many % of visitors can you convert to earning? Normally it’s just 1~3%.
- Total profit or lose as a result of calculating the overall expenditure and earning per month.
- Possibility of expanding the Freemium business model
Above is just some of the suggestion that you should think about before starting the Freemium business model. Remember that not every ideas or businesses are suitable for Freemium business model. You should take the time to study and check out other examples. Always test the market before going full force. Good luck.
P/S: I have an idea of FREE stuff that I can give away for this money making opportunities blog. I hope that I can finalize my plan and release the FREE stuff before the end of the year. Wish me luck.