Are you using ‘Freemium’ to enhance your reputation?

Providing ‘freemium’ products and services alongside your existing price-driven offerings can significantly increase your attractiveness as a provider, build trust and enhance your reputation.

Clients and consumers are more critical than ever before, more cynical than ever before, and there’s significantly more competition than ever before. The expectation of being able to ‘try-before-I-buy’ is more widespread and available than ever. ‘Prove you have what I want before I’m willing to pay for it’ is the mantra for increasing numbers of consumers, especially younger people.

Although it may seem that the provider may have everything to lose and little to gain from providing freemium products or services, the business benefits of helping people engage with you in a ‘low-or-no-cost’ way are worth considering before dismissing it out of hand.

Far from devaluing you, providing freemium products or services alongside your existing price-based offerings can be extremely beneficial.

• Freemium offerings can help you test your market and provide useful feedback that can help you shape premium fee-generating products or services.
• Removing price as a possible barrier to engagement can help you attract a larger number of potential users who may be price-sensitive, but who may be willing to move from ‘free to fee’ and pay for premium products or services at a later date.
• Being able to try your products or services in a low-cost/no-cost way is likely to reduce any perceived risk or doubt new users may have initially and help build trust.
• Once engaged, you then have an opportunity to create a positive relationship with the freemium user which may result in them choosing to pay for other products or services you provide at some point at virtually no cost to you.
• Providing reliable, high-value, freemium items can make you highly recommendable. Given that it’s 6-7 times more expensive to attract one new client or customer than it is to retain one, having freemium users recommend you to others is a highly cost-effective way of gaining new clients.
• Offering some of your freemium products or services as a ‘value-add’ to non-competitors or media outlets to use as a give-away, prize or thank-you item can enhance your exposure to a wider audience and enhance your relationship with the third party.
• Developing freemium items on a regular basis can help you stay current, explore new thinking and opportunities and reinforce the value of your premium fee-generating products and services.

Used wisely, freemium products and services should not detract or devalue your fee-generating offerings. On the contrary, they should provide value in their own right whilst underscoring the value your premium products provide.

It’s smart business practice in 2010 and beyond and can help ‘Increase the Value of You’.