We have a riddle for you: “What is not free and not premium?” One more clue: You are probably already using at least one of these services on your digital devices.
Give up? We’re talking about services many have dubbed: “Freemiums.”
Janna Atcheson and Ash Elghamry’s electronics are loaded with them. Janna tells us, “We use a lot of different varieties of freemium models, applications and services.”
What are freemiums? Roger Cheng, Executive Editor at CNET says, “Freemium is a business model that essentially is any kind of program or game or service that is offered for free with the hope that you’ll pay extra to unlock new features and new services.”
Janna and Ash use “Linked In” for networking, “Dropbox” for computer storage and recently paid for premium “Spotify” for music. Ash said, “I do think it’s good for consumers to be able to sample the product or the application before they end up paying for it.”
There are news and game apps, too.
Cheng said, expect to see a lot more freemium-based services, “The growth of freemium is explosive.”
One possible pitfall, according to Cheng? Some digital games offer the option to pay for bonus levels and characters… so if you get hooked, it could put a dent in your wallet. Cheng warns, “With freemium you can spend upwards of 50-60 dollars in little increments getting these upgrades time after time. So, if you’re really, if you’re one of those people who gets into a game, the freemium model can kind of suck you down this rabbit hole where you are spending more money than you’d like.”
Janna says the premium services they paid for are worth it. “It makes a big difference in what you can access, and it makes a big difference in the quality of experience you get.”
Some experts think the “freemium” model is more successful than offering 30-day trial periods to try out a product.
