This one is article 74 (might differ depending on which platform I post on). I started writing daily in December 2018 and so far so good. I’m focusing on bringing as much value to the reader as possible when it comes to reducing user churn. The targeted readers are tech CEOs, more so if they’re building a SaaS company.

Essentially, what I’m saying can be boiled down to one sentence: create an emotional connection to people while helping them. There are nuances here and there and if I just say that over and over again, people will interpret it through their filter (which is lovely to see in the comments, I want to know as many points of view as possible) — but I continue writing by expressing mine.

Today I was reading this piece from 2011 in which Gabe Newell is talking about Steam’s pricing experiments. For context, he’s running Valve, the company behind Half Life, Counter Strike, DOTA 2, Team Fortress and many other world-class games.

Here’s the excerpt that got my attention:

Newell also claims that making Team Fortress 2 free-to-play increased sales by a factor of five. “That doesn’t make sense if you’re trying to think of it purely as a pricing phenomenon.”

But he says it pays off in the long-run, since most F2P publishers Valve has talked to have reported a 2-3% conversion rate of people purchasing in-game. A meatier game like TF2 enjoys 20-30% of people who purchase extras.

Most probably it’s confirmation bias but it got me back to the piece I posted the other day that had a lot of heat around it.

Indeed, the “opening your doors to everyone” idea has taken place in gaming since about a decade ago and has seen to be profitable — that is, as long as the game is good in the first place.

For anyone still not believing in this, here’s one way to look at it: aren’t Google or Facebook exactly the proof of that?

Isn’t Fortnite, a game that created social effects (along with the plethora of other games that generated a shit-ton of revenue) the proof of that? Sure, if you don’t know who’s the product then you are the product. That still is within rules.

What’s also within the rules outlined by that post is this: charging premium users enough so as to cover the costs of running the freemium. Google and Facebook (the companies, not the products) have gone one step ahead and made their platform a place where even the premium-paying people fight amongst themselves so as to see who can bring them the most monetary value

Call it an auction.

P.S: Here’s a link to part 2. Happy Sunday!

About Ch Daniel

I run Chagency_, an experiences design agency that specialises on helping tech CEOs reduce user churn. We believe experiences are not only the reason why users choose not to leave but also what generates word of mouth. We’re building a credo around this belief.

If I’ve brought you any kind of value, follow me and get in touch here: LinkedIn | Twitter | Email | Quora | YouTube (same content but in video)

I’ve also created an infinitely-valuable app for sneaker/fashion enthusiasts called Legit Check that impacted hundreds of thousands over millions of times – check it out at chdaniel.com/app

Please share this with someone and subscribe to our newsletter!— helps us keep pumping content?