A lot goes into designing a free app. But the payoff is undeniable.
You get leads that are trying to solve a problem your product addresses. You grow your pipeline. And you close more deals.
Not bad for a marketer.
In this post I’ll explore why free tools work so well, provide case study examples, and explain the requirements for generating new customers via your free app.
Why Free Apps Rock
One of the biggest reasons I love the free app-as-a-marketing-tactic is you build once and see years of returns.
The Hubspot Marketing Grader tool was launched in 2007 and it’s still kicking today. The longer it’s out there, the cheaper the cost per lead (and ultimately cost per customer).
However, there are risks in upfront investments, so plan wisely.
Beware The Risk Of Freemium
A lot of companies will just go “freemium” by providing a free tier of their product. Don’t do this. You’ll start supporting and building for your lowest common denominator, i.e. your freemium users.
Free plans can lead to significant amounts of customer support and take product focus away from building premium features. But you don’t run into this with well designed free tools.
For instance, social media analytics company, SimplyMeasured, released sections of their product as a free tool. It sets the right expectations and keeps focus on areas of the business that matter.
Let’s look at a few examples of companies that have nailed the free tool strategy.
3 Examples Of Free Apps That Generate Demand
In this section, we’ll explore 3 of our favorite apps to see what makes them so effective. All of these are marketing based or targeted to marketers. But this works for any industry, and particularly well in software/SaaS.
Hubspot’s Marketing Grader
The original tool-as-a-marketing-tactic, Hubspot’s Marketing Grader, has analyzed millions of websites, been featured in TechCrunch and won numerous awards.
Using the tool is incredibly easy -- all that’s needed is your email and a website URL.
Once the tool has analyzed the domain, a full list of grades is provided for everything from SEO to lead generation.
Overall the tool is simple in its use, but complex in its output, a great mix that aligns well with Hubspot’s audience and product.
Social Media Tools By SimplyMeasured
SimplyMeasured has pumped out an amazing 12 social media tools. They're all stripped down elements of their paid product.
Providing slivers of functionality from a paid product is a great way to capture those that want to learn more about the full suite.
WordStream’s PPC Grader
Most like Hubspot’s Marketing Grader, WordStream’s AdWords Grader rates a specific part of your marketing: paid search, which is their core focus.
As such, they go much deeper, connecting directly into the AdWords account. This let’s Wordstream have access to not only public data (like Hubspot is using) but also locked account information, which is a gold mine for qualification and sales prioritization.
WordStream also does a great job collecting contact and targeting information in the first step of the free tool onboarding process.
Elements Of A Great Free Tool
Now that we’ve explored a few great tools, what do they all have in common that makes them so successful? How should you think about a free tool?
Through my analysis I found 4 common traits of highly effective free tools:
It provides real value
It collects the right information
It is built for organic growth
It targets users who are qualified to buy
At the center, and the most important element, is that the free tool provides value. You are asking for something in return so make sure the value exchange is higher than your request.
Next is to make sure you collect the right information. Make the most of your tool by collecting the right information (and nothing more). See the next section for a deeper dive on this.
Next is to have target (audience) alignment. The tool needs to attract the same or very similar audience to who you sell the paid product offering to, otherwise it’s wasted leads.
Finally, you need to have, or at least strive for built-in growth. Free tools need to be able to grow on their own either through formal distribution (like the Salesforce AppExchange) or social sharing. All three of these tools went the social sharing route, though with their own unique twists:
Hubspot makes it optional with a big "Tweet This" button
SimplyMeasured requires a follow on Twitter to see the report
WordStream makes it easy to show off your score
Hierarchy Of Free Tool Information Collection
Figuring out what information to collect with your tool can be a challenge. Over collect and you have to increase the value offering. Under collect and you will have a harder time converting users to the paid offering because you know less about them.
Analyzing our own free tools and the ones in this post, I came up with a simple 4 stage hierarchy for free tool information collection.
First, at a bare minimum, you need to be collecting contact information such as an email and phone number. Without this you will have almost no chance converting to a paid user.
Next is the targeting information such as their job title and industry. This will help you make sure the right people are using the tool and start to enable customization of the sales and nurturing messaging.
Next is the qualification information based on information collected with the tool. Not every person using the tool is going to be a target for sales. Identify the criteria and set a baseline for how many users should be.
In WordStream’s example it might be percentage of people with $1,000+/mo in AdWords spend (or higher) and a score of less than 50% on the grader, since they are selling optimization software. For SimplyMeasured it might be amount of Twitter followers.
If your tool is highly valuable, you should be collecting qualification information from your free tool users.
Lastly, is collecting information on pain points or areas of improvement. This information is used for custom sales pitches.
For example, Hubspot knows which areas of the website are under-performing. They can collect this information and pass to sales.The sales team now has specific information they cantie to real benefits to. They can provide value during the sales process, such as, “Your SEO isn’t doing well. Let me show you how we can help.”
Time To Build Your Free App
Now that you know what makes a successful free tool marketing campaign, it’s time to build something.
Your free tool should solve a problem that prospect are dealing with, provide a portion of the value from your premium product and require little maintenance costs.
In design, working with constraints is a benefit. Otherwise there are too many variables to work with. As is true for building a free tool, there are constraints that should guide spec requirements.
Whether you’re a small startup or a large company, creating a free tool is a full proof marketing tactic. So long as you provide users with real value and set up the lead generation and nurturing flow, you’ll be awarded with a steady channel of new customers.
And before long it will be time to build another free tool.
Integrate With The Rest Of Marketing And Sales
To ensure your tool-as-a-marketing-campaign succeeds, it's important to integrate it with the rest of your marketing.
You need to have a really strong sales component to convert free users to paying ones.
Think about how the information is passed to sales, what information used, and different ways to convert users.You have details like an SLA with your sales team, promotional campaigns and reporting to worry about.
If you're using online marketing channels like your website, social media, and paid search then a marketing attribution tool will allow you to track the channels that are driving new users to your app.
While a free tool is an upfront investment, it pays off when the campaign is designed well from the beginning.
Follow our blog for useful demand generation tips and tactics.