Crowdsourced Customer Acquisition: A Conceptual Framework for Freemium and Propositions for Future Research
MetadataShow full item record
Freemium has grown tremendously in use and importance the last years, butresearch is still in its infancy. This thesis explore how companies that usefreemium acquire customers through their existing users and customers. This thesisposit that the primary value of free users in freemium derive from making thisacquisition process both more efficient and more effective, allowing a companyto grow rapidly at a low cost.The customer acquisition process was explored through qualitative interviewswith high-level employees and investors in companies ranging from the Fortune100 to failed businesses, and the research process was firmly based in groundedtheory. Based on this process we proposed a conceptual framework termedcrowdsourced customer acquisition which describe the customeracquisition process in freemium.Crowdsourced customer acquisition entails giving some consumers access to avaluable service for free into perpetuity. This causes these users to becomeloyal and engaged, and through their engagement most importantlyword-of-mouth other consumers become interested. By making the choice to trythe service a "no-brainer" for these consumers the company acquire new users.These new users, in turn, can both bring in new users and be converted to payingcustomers. Learning and adapting based on these events the company can improvefuture user acquisition and conversion by increasing their efficiency andeffectiveness.In addition to this acquisition process, and because freemium is at a very earlystage in research, we also proposed several avenues of further research based inthe proposed acquisition process.The primary managerial implication of this research is that is enablepractitioners to reason about their freemium model to a much larger degree, e.g.in terms of formulating, understanding, analyzing, and sharing the company scustomer acquisition model. The proposed framework can thereby be elemental inthe process of designing a viable business around freemium.The primary theoretical implication of this research is that it commence adeeper look into freemium itself, an area which is currently not well understoodfrom a theoretical standpoint. It brings together several avenues of research togive a coherent view of one facet of freemium; thereby indicating that severalof the research findings for traditional products and services also yield forfreemium-based services.