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Strategy

Freemium

Freemium is a business model that gives a functional version of the product away permanently and charges for a better one, using the free tier as the acquisition channel rather than as a trial.

Freemium is a distribution strategy wearing a pricing label. The free tier’s job is to reach people no paid funnel would have reached, hold them long enough to become habitual, and then run into a boundary that makes the paid tier obvious. Every part of that depends on where the boundary sits.

Set it too generously and the free tier is the product, with a paid tier nobody needs. Set it too tightly and the free tier stops being useful, which removes the reason anyone stayed long enough to consider paying. The boundary that works is usually not a feature list at all but a ceiling the subscriber hits while succeeding: the storage that fills, the export they want to keep, the second device, the season that starts. Finding it is empirical, and the honest version of the question is which limit correlates with people who later pay, not which limit sounds fair in a planning meeting.

Because there is no expiry, timing carries the weight a deadline would otherwise carry. The upgrade prompt has to arrive at the boundary rather than on a schedule, which means the paywall is triggered by what the subscriber just tried to do and says so in its first line. A prompt that repeats on a timer teaches people to dismiss it, and dismissal is expensive in a model where the same person may see the offer for years. Deciding who sees which prompt, after which action, is the branching that gets built in Flows and tested against the boundary itself as a variable. Worth separating from the gate types on the paywall entry: a soft paywall is a way of metering access to content, while freemium is a claim about which version of the product is free forever.

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