In freemium marketing, product analytics are the difference between conversion and confusion

The freemium marketing approach has become commonplace among B2C and B2B software providers alike. Considering that most see fewer than 5% of free users move to paid plans, even a slight improvement in conversion can translate to significant revenue gains. The (multi) million-dollar question is, how do they do it?

The answer lies in product analytics, which offer teams the ability to ask and answer any number of questions about the customer journey on an ad-hoc basis. Combined with a commitment to testing, measurement and iteration, this puts data in the driver’s seat and helps teams make better decisions about what’s in the free tier and what’s behind the paywall. Successful enterprises make this evaluation an ongoing exercise.

Often, the truth of product analytics is that actionable insights come from just a fraction of the data and it can take time to understand what’s happening.

Sweat the small stuff

A freemium business model is simply a set of interconnected funnels. From leads all the way through to engagement, conversion and retention, understanding each step and making even small optimizations at any stage will have down-funnel implications. Start by using product analytics to understand the nuances of what’s working and what isn’t, and then double down on the former.

For example, identify specific personas that perform well and perform poorly. While your overall conversion average may be 5%, there can be segments converting at 10% or 1%. Understanding the difference can shine a light on where to focus. That’s where the right analytics can lead to significant results. But if you don’t understand what, why and how to improve, you’re left with guesswork. And that’s not a modern way of operating.

There’s a misconception that volume of data equals value of data. Let’s say you want to jump-start your funnel by buying pay-per-click traffic. You see a high volume of activity, with numbers going up at the beginning of your funnel and a sales team busy with calls. However, you come to learn the increased traffic, which looked so promising at the outset, results in very few users converting to paid plans.

Now, this is a story as old as PPC, but in the small percentage that do convert, there’s a lot to learn about where to focus your efforts — which product features keep users hooked and which ones go unused. Often, the truth of product analytics is that actionable insights come from just a fraction of the data and it can take time to understand what’s happening. Getting users on board the free plan is just the first step in conversion. The testing and iteration continue from there.

The dropped and the languished

Within the free tier, users may languish — satisfied with whatever features they can access. If your funnel is full of languishing users, you’ve at least solved the adoption problem, so why are they stuck? Without a testing and tracking approach, you’ll struggle to understand your users and how they respond, by segment, to changes.

A redesigned iMac with Apple Silicon is on the way, here’s what you need to know

The Apple Silicon transition is under way, and Apple is rumored to have multiple new Macs in the pipeline for 2021. This includes new 14-inch and 16-inch MacBook Pro models as well as a redesign for the iMac. These new machines will represent the next wave of Apple Silicon-powered Macs, coming after last year’s release of a new MacBook Pro, MacBook Air, and Mac mini.

The redesigned iMac is expected to be a major overhaul, and it comes after nearly a decade of stagnation. Read on for everything you need to about the resdesign…

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Minnesota introduces new App Store reform legislation following failed bill in North Dakota

After a failed bill was proposed in North Dakota earlier this month that would have forced Apple to allow developers to sideload apps and use alternate in-app payments, a similar bill has been officially introduced in Minnesota.

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Apple Music showcasing session musicians and songwriters in ‘Behind the Songs’ collection

Apple Music is showing off its love for the industry in a new collection called Behind the Songs. Here, Apple Music members can discover music with an emphasis on songwriters, producers, and session musicians who may not otherwise receive top credits.

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Sources: Lightspeed is close to hiring a new London-based partner to put down further roots in Europe

Lightspeed Venture Partners, the well-known Silicon Valley venture capital firm that has backed the likes of DoubleClick and Snapchat, is in the midst of hiring a second London-based investment partner as it looks to put down further roots in Europe, TechCrunch has learned.

According to multiple sources, Paul Murphy, whose investments include Tier, Hopin, Klang and Bunch, is being hired away from Northzone, the European VC firm that’s probably best known for being an early backer of Spotify. The signing is still in progress but could be announced in the next few weeks. Murphy has been at Northzone for three years and was promoted to general partner in late 2019 when the firm raised a new $500 million fund.

I’ve reached out to Murphy and Lightspeed for comment and will update this article if or when I hear back.

Prior to VC, Murphy co-founded Dots, the mobile games company in New York. He also built and invested in various companies at startup studio Betaworks. (Notably, Murphy helped launch Giphy in the U.S., which Lightspeed ended up backing and later sold to Facebook for $400 million). Before that, he held several roles at Microsoft in the U.S., U.K. and India. He also holds a BS in Computer Engineering from Virginia Tech and an MBA from The IE Business School in Spain, according to the Northzone website.

Meanwhile, the fact that Lightspeed is formally putting more people on the ground in Europe should come as no surprise to close watchers of the ecosystem here. TechCrunch first heard rumors that the Menlo Park-based VC was recruiting a partner in London as far back as August in 2019. That saw Rytis Vitkauskas join the U.S. firm as its first partner in London the following September, according to LinkedIn. Should Murphy’s recruitment be confirmed it would signal a significant expansion of a Lightspeed London “office,” and confirmation that the VC is doubling down in the region.

Those rumors in late last 2019 coincided with news spreading that another Silicon Valley VC heavyweight, Sequoia, was also doing the same — along with talk of other U.S. VC firms — as European tech companies continue to create more value than ever before. Sequoia’s own plans were finally announced in November, including that it had poached Luciana Lixandru away from rival Accel Partners.

How to ace the 1-hour, and ever-elusive, pitch presentation at TC Early Stage

Lisa Wu, a partner at Norwest with investments like Calm, Plaid, Opendoor and Grove Collaborative, has a message for founders: Think like a VC during your pitch presentation. After all, accepting capital isn’t simply adding more money to your balance sheet. It is about picking a venture partner who will be there with you through the highs and lows. Some even liken it to a marriage that you can’t divorce from.

No pressure, of course.

Don’t worry, we won’t leave you hanging: Wu is joining us at TechCrunch Early Stage, our annual event with content specifically tailored to first-time founders and investors, to talk about exactly this.

Before Norwest, Wu worked in Amazon’s corporate development team, Bessemer Venture Partners and founded BANZAI, which brought food focused on quality and nutrition to schools.

With experience on both sides of the investing table, Wu is going to talk about how founders can make the most out of each minute within a one-hour pitch presentation. She’ll discuss ways that founders can read the virtual room, how to take advice and how to talk big-picture ideas to convey market size and competition.

Wu joins a fantastic cast of top experts, discussing topics such as fundraising, operations and marketing. Her workshop is part of the two days of events that explore seed and Series A fundraising, recruiting and more for early-stage startups at TC Early Stage – Operations and Fundraising on April 1 & 2. Grab your ticket now before prices increase tonight!

 

Review: Satechi’s new MagSafe compatible stand charges AirPods and iPhone 12 for $60

Satechi unveiled its first MagSafe compatible multi-device charger for iPhone 12 and AirPods back in January and now it’s available. The Aluminum 2-in-1 Magnetic Wireless Charging Stand features a floating magnetic mount for your iPhone 12 with a dedicated spot for wirelessly charging AirPods below. Coming in at one of the most affordable prices for a MagSafe compatible dual-charger at $60 from a reputable brand, we had to test out this new Satechi release.

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HomeKit Weekly: I am building a new house, so I’ve got a lot of HomeKit decisions to make

A few weeks ago, my wife and I put a contract on a plot of land, so we’re looking to build a new house within the next year. Of course, HomeKit will be a significant part of it. I plan to rethink everything about my HomeKit environment for this new house and start from scratch from a software standpoint. Are you building a new home? Follow along with me to gain tips and tricks on creating the HomeKit environment during the home building process. Some of the products will be installed by the builder, but I will install others after moving into the home.

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Deals: iPad Pro up to $679 off, Beats Solo Pro Headphones $170, more

All of today’s best deals kick off with an up to $679 off sale on iPad Pro. Not to mention, Beats Solo Pro Headphones at $170 and Nomad’s Lightning Carbon Carabiner to $17. Hit the jump for all that and more in the latest 9to5Toys Lunch Break.

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9to5Mac Daily: February 26, 2021 – macOS Big Sur update, Apple Siri research

Listen to a recap of the top stories of the day from 9to5Mac. 9to5Mac Daily is available on iTunes and Apple’s Podcasts app, Stitcher, TuneIn, Google Play, or through our dedicated RSS feed for Overcast and other podcast players.

Sponsored by Appfigures: To get the latest scoop on the newest apps and games, sign up for the Appfigures ‘This Week in Apps’ newsletter right here.

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