How did you figure out your monetization model?
I'm getting close to wrapping up my Saas MVP. I've got a few ideas of how I want to monetize, but I can't decide the best option. Should I do freemium upgrades (make some features 'paid for', while the basic is free), outright charge monthly for everything (could charging curb virality and adoption?), or do a free trial that expires, or just slap some Ads on the site — make it free and hope Ads pay the bills. I know the answer is "it depends" on what your app is doing — but, how did you decide on your business model? Did you nail it at first time, or did you have to pivot to get it 'right'?
Personally I feel if it's only your MVP, start out free to get in as many early adopters as you can. Speak to them about what they would/wouldn't pay for and let that guide your decision as much as possible. More and more companies are starting out using the freemium model to acquire users, just depends if you are looking for bottoms-up growth.
This is what I'm strongly thinking about doing. Anyone have any pointers on how to talk to customers? Is it merely a matter of cold emailing them? Asking a 10 minutes phone call?
I'm so used to designing, engineering etc.. this part is so new to me.
This episode of the IH podcast has some good tips on how to go about asking the right questions.
https://www.indiehackers.com/podcast/154-rob-fitzpatrick-of-the-mom-test
You could approach in a number of ways depending on your product. For example, Superhuman use Typeform surveys (https://firstround.com/review/how-superhuman-built-an-engine-to-find-product-market-fit/) as a good way to get to know their customers when they sign up or after they use your product. From there if you can identify who your core users are and therefore who you should focus your efforts on trying to speak to, outreach by email or Linkedin for feedback. Early adopters are typically happy to oblige which is what makes them so valuable (thus I believe you should never ever charge them). If you're looking for frameworks for freemium check out Loom and Calendly as good real world examples. For frameworks on product led growth Openview Ventures Blog and Wes Bush PLG typically have a lot of guidance on this.
I'm in this stage with my project. It seems (now) that you need reviews from users before you can get any (authentic) traffic.
At the moment, I've got two potential business models that can be useful. So I'm trying one now for a while and then change it. So, I guess you should just list down a few methods and try each one for a while until you get a sale.
What I found works well is making sure the interests of your users are aligned with your company's interests: it's easier to build your strategy, communication, features... when everything you do is in the best interest of your users.
One way to do that is with pricing models like commission-based or credit systems. The more value people get out of your product, the more they pay for it (which they don't mind because again... they get more value).
E.g. my company (in short: webshops for non-profits) works purely on commission. There are no fixed fees, no subscriptions, no paid premium features, nothing. Everything I do is to maximize my users' turnover (and thus my commission), which is their goal as well.
The less friction there is to get instant value, the more people will gravitate to your product. I'm a big believer in freemium. If you can produce something of value for free, people will use it and best of all share it naturally. What I mean by 'less friction' is avoid gateways and unnecessary tasks: Registration, paying at first if it makes sense... these create friction and reasons for people not use and share a product. Once they try it, they're more willing to register or pay since they know it provides value. Lastly, freemium only works if you can create even more valuable for people willing to pay.
Yea that's what I'm trying to figure out now. Definitely trying to make it frictionless as possible. Ads would be no friction (might be annoying tho) but it might not make enough money. Have to weigh the options..
Hard to give suggestions without knowing what you are offering. If you create a product that provides value, it generally will make more money than ads will. I'd likely concentrate on building useful features.
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What is the difference between pay-as-you-go and subscription?