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FREE AS A BUSINESS MODEL Freemium

Pattern

102 KP KA VP CR CS

PATTERNS

KR CH

The platform is the most
important asset in the
freemium pattern, because
it allows free basic services
to be offered at low C$ R$
marginal cost.

An important metric to users
follow is the rate at which describes how many users
customer relationship free accounts convert to a company with a freemium
The cost structure of this must be automated and low
pattern is tripartite: usually with cost in order to handle large premium accounts business model can attract
substantial fi xed costs, very low numbers of free users.
marginal costs for services to
free accounts, and (separate) fi xed costs a company
costs for premium accounts
incurs to run its business
model (e.g. systems costs)

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