Freemium Models
Freemium models are a business strategy where a product or service is offered for free with basic features, while premium features or advanced functionality require payment. This approach is commonly used in software, apps, and online services to attract a large user base and convert a portion into paying customers. It balances accessibility with monetization by leveraging free usage to drive adoption and upsell opportunities.
Developers should learn about freemium models when building or marketing software products, especially in competitive markets like SaaS, mobile apps, or consumer tools, to understand user acquisition and revenue generation strategies. It's useful for startups and established companies aiming to scale quickly by lowering entry barriers, gathering user data, and testing market fit before implementing paid tiers. Knowledge of this model helps in designing pricing structures, feature segmentation, and customer retention tactics.