By Dennis Gurock, Co-Founder, Gurock Software
When we brainstormed marketing ideas for our first product SmartInspect, we were quick to add a free Personal edition of our logging tool to the list. We were pretty sure that it would generate lots of traffic to our website, motivate many website owners to link to us and generally increase the interest in our product. Additionally we hoped to convert some users of the Personal edition to paying customers later. To prevent that the free edition would directly compete with our paid-for full version, we added some limitations to the free edition:

  • No support: We wouldn’t offer any support for the free version except answering the occasional question in the support forum. Direct email support for example, would be reserved for paying customers of the full edition.
  • Just the basic features: We made sure that only the very basic features would be included in the free edition. More advanced features would only be available in the professional version.
  • Only for non-commercial use: We also added a clause to the license to prevent the usage in commercial projects. This would only allow freeware and open source developers to use the SmartInspect Personal edition. We also prominently displayed this limitation on the product website.

Six months after the launch of SmartInspect, we discontinued the Personal edition. It just didn’t work the way we expected. After the initial release we got some good links to the Personal edition and many people downloaded it. But after the success of the Personal edition in the first months, people lost interest in it and the download rate of the free edition stalled. It turned out that the free edition would require just as much marketing effort as the full paid-for edition – and that with questionable results. Additionally, our assumptions were just plain wrong.
You can’t just ignore support emails from Personal edition users even if it’s officially ‘unsupported’. We answered any questions just as promptly as questions from customers and trial users. And users who normally would have bought the full edition, happily used the Personal edition because it was useful enough for them. We read this more than once in emails and blog comments.
Additionally, our ‘non-commercial’ clause was ignored by many users and the free edition was used it in commercial projects and products. The problem with such a restriction is that it’s very hard to enforce. I guess most people didn’t really know about this limitation and some users probably ignored it – it really doesn’t matter though, because it had the same effect: People who would have bought our product used the Personal edition instead.
Sure, we had some customers who first used the Personal edition before they purchased SmartInspect. But at least some of them would have downloaded the trial edition instead if we didn’t have a free version.
I’m not saying that the free edition was a waste of time: We got some great feedback and got a bit more exposure of our product, but we would definitely not do it again. I’m sure that other businesses have more success with such a marketing move, but at least for our product and our market it just didn’t work the way we hoped. In retrospect it would have been much better if we invested the time we needed to build the Personal edition for other marketing activities.
So, why am I telling you this? Just like Eric Sink, I think failures are a great opportunity to learn something. By telling you about this failed marketing move, maybe you can save some time by not making the same mistakes.


Dennis Gurock is one of the founders of Gurock Software, a small software business located in Germany. He can be reached at dg@gurock.com

5 Comments

  1. Thanks for sharing this, this is exactly the sort of interesting information I’d like to see from MicroISV blogs!
    I have actually seen examples of commercial software that uses commercial components unregistered and part of their instruction to their users is “when this popup comes, click on it to remove it”. It would be especially true for a component that comes without a nagware. What is the chance a MicroISV will actually go for a lawsuit against an abuser? The lawyer costs will be higher than the expected return on the lawsuit.

  2. Very helpful post. This is on the list of tradeoffs that many small software companies face.
    The challenge with “free editions” (as you’ve already experienced) is that you are then effectively competing with yourself. Now, your paid version has to make sense, not when compared to nothing — but when compared to your free version.
    So, the questions consumers ask themselves: Is the functionality difference (and the value I get) between free and non-free enough to where I’d actually pay something?
    The answer, it seems, in many cases is no.

  3. A good and timely post. I’ve been going back and forth in my thinking about whether to produce a free (light) version or not. There are real issues with the mindset of people that expect things for free, to the point you might even be better off without them, even as paying customers.
    In hindsight do you think you could (should) have cut more functionality out of your free version?

  4. Timely post for me as well. I’m contemplating a Free version to garner some initial interest with the release of my first product. I think you are right though, any company dedicated to strong customer service will inevitably offer it, even on unsupported products. While the marketing bang you get with a Free version is very tempting – I’m still on the fence about offering it. Right now I’m leaning more towards a longer duration, full featured trial edition instead. But we’ll see.

  5. I don’t think reducing more features from our Personal edition would have helped that much. Removing all the features that make the free edition useful isn’t a great advertising for the full product.

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