Monday, October 1, 2012

How a Freemium site got me to upgrade

I've been in the market for webinar software and came across via a search engine.  A few elements of their business model appealed as examples of behavioural techniques in play.

Freemium model
Adopting an increasingly popular model for online providers, Anymeeting offers both free and premium options for its online meetings and seminars.  The catch with the free option is that you and your participants will see advertising.  Given I will be charging for my webinars and therefore don't want advertising interfering with the experience of participants I have decided to ditch the free service in favour of a subscription.  A couple of advantages of this tiered system; buyers get to trial the service before committing to payment (building confidence and familiarity) and Anymeeting diversify their revenue model by having paid subscribers and advertisers.

Free version with ads 
Upgrade path alleviates pain point
Outcome oriented CTA
We are used to seeing language like 'upgrade to experience benefits...' on sites, but what I liked about Anymeeting was how they expressed it in their call to action (CTA).  Rather than 'upgrade now' or 'subscribe', Anymeeting have gone with "Remove ads", a simple, outcome oriented CTA.  Aside from removing any doubt as to what would happen by clicking through, this CTA also tapped into the behavioural principle of loss aversion where we are more motivated to avoid pain (poor reaction by paying audience to seeing ads) than seek gain.

Helpfully, they also provided a comparison of what your users see in both free and paid versions of the site.
Ads vs None visual

Anchoring and influencing choice
Anymeeting do their best to upgrade buyers from the time they first visit.  Notice how the three program levels are displayed, with the Pro for Meetings package deliberately shaded green to stand out.  If they wanted to minimise free option sign-ups they could have taken things further by choosing a more muted CTA for this program (eg dark grey) to shift buyer attention to the paid alternatives.
Program comparison

You'll also note the use of price relativity between the Webinars program ($69.99) and the Meetings option ($17.99) which would encourage take up of the latter.

Payment terms 
The thing I didn't like?  The payment process for upgrading to a subscription defaulted to a monthly recurrent charge and was not sufficiently clear on how I could stop the payment.  Supporting the buyer at the point of payment with this type of information is important to overcome risk aversion. Sure some buyers (like me) will proceed, but dropouts become more likely and undermine the effort its taken to get them to the point of sale.  Providing money back guarantees is good, but letting the buyer know how they can escape is powerful too.

Lessons for your business
Lessons for your business?  Consider a Freemium model to get people started, rethink how your call to action can be expressed as an outcome, take the lead in how you structure the options you sell and finally, cover off last-minute payment nerves with guarantees and explanations.

(As with all my blogs I have written this piece based on my experience as a customer and have not been commissioned by Anymeeting.)
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