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- Freemium vs. Free Trial: Which Model Drives More Conversions?
Freemium vs. Free Trial: Which Model Drives More Conversions?
Filippo Ferri
February 09, 2025
👋 Welcome to Momentum Inspired!
If you’re building a Product-Led Growth (PLG) business, choosing the right pricing model can make or break your revenue strategy.
Should you offer a freemium plan or a free trial?
✅ Freemium attracts more users but can lead to low conversion rates.
✅ Free trials create urgency but require strong onboarding to convert users quickly.
So, which one drives more conversions—and when should you use each?
Let’s break it down! 🚀
🔍 The Key Differences: Freemium vs. Free Trial
Feature | Freemium | Free Trial |
|---|---|---|
User Commitment | Low—users can stay free indefinitely. | Higher—users know access is limited. |
Adoption Speed | Faster—low friction to try the product. | Slower—users feel urgency to test everything before the trial ends. |
Conversion Focus | Upgrade when they need premium features. | Upgrade before the trial expires. |
Best For | Products with viral growth loops (e.g., Notion, Slack). | High-value SaaS tools requiring immediate onboarding (e.g., HubSpot, Salesforce). |
🚀 Your takeaway:
If your product has network effects & high engagement, freemium can drive organic adoption.
A free trial may work better if your product requires setup to show value.
💰 The Pros & Cons of Each Model
Freemium: When It Works Best
💡 Best for: Products with low-cost onboarding & built-in virality (e.g., Slack, Canva).
🔹 Pros:
✔ Attracts millions of users quickly.
✔ Encourages long-term engagement before monetization.
✔ Works well if premium features create natural upgrade triggers.
🔻 Cons:
❌ Low conversion rates—many users never pay.
❌ Can lead to high server & support costs for free users.
📌 Example:
- Slack’s free plan limits search history & integrations—driving teams to upgrade.
- Notion’s free plan allows individuals unlimited notes but requires payment for team collaboration.
✅ Your Move:
- Limit free plans with clear upgrade triggers (e.g., storage, usage, team size).
- Focus on viral features that bring in more users.
Free Trial: When It Works Best
💡 Best for: High-value B2B SaaS products requiring onboarding & activation (e.g., HubSpot, Figma).
🔹 Pros:
✔ Encourages higher conversion rates by creating urgency.
✔ Works well for enterprise customers evaluating ROI.
✔ Helps users experience full product value before paying.
🔻 Cons:
❌ If users don’t activate quickly, they churn.
❌ Requires strong onboarding to show value fast.
📌 Example:
- Figma’s free trial lets teams collaborate, but requires payment for unlimited files.
- Calendly’s trial lets users test premium scheduling automation before locking features.
✅ Your Move:
- Shorten trials to 7-14 days to create urgency.
- Use in-app nudges & email sequences to drive conversions.
🚀 Case Study: How Zoom Scaled With Freemium & Free Trials
Zoom started with freemium to drive viral adoption but added free trials for enterprise sales.
🔹 Freemium Growth:
✅ 40-minute limit for free meetings → Encouraged team adoption.
✅ Viral invites → Users introduced colleagues, fueling network effects.
🔹 Enterprise Free Trial:
✅ Large companies needed more than 40-minute meetings → They upgraded fast.
✅ Sales team engaged free trial users to close bigger deals.
🎯 The Result? Zoom scaled to $4B+ ARR using both models strategically.
🚀 Your Takeaway: You can combine freemium for viral growth & free trials for enterprise conversions.
💡 Quick Wins to Improve Your Pricing Model Today
✅ If using freemium: Define a clear upgrade trigger (e.g., storage, team size, premium features).
✅ If using free trials: Optimize onboarding to show value within the first session.
✅ Test hybrid models: Use freemium for SMBs & free trials for high-ticket customers.
📣 Let’s Talk!
Which model has worked best for your business? Reply to this email—I’d love to feature your insights in a future issue!
Until next time,
Filippo
P.S. Know someone rethinking their pricing strategy? Share this issue with them! 🚀
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