The Free Tier Cost Audit
Audit what the free tier really costs
Our free tier: [WHAT FREE USERS GET, HOW MANY, WHAT THEY COST US IN INFRA AND SUPPORT, CONVERSION RATE TO PAID, ARPU OF CONVERTED USERS]. Run the audit: cost per free user per month, what share are real prospects vs tourists vs abuse, which free feature drives conversion and which just drives cost, and three options - gate a feature, add a usage cap, or time-limit the free plan - with the revenue and churn effect of each argued with our numbers. End with your recommendation and the metric to watch for 60 days after the change.
Inputs needed
- #Free tier scope, user count, infra/support cost, conversion rate, ARPU
What good output looks like
Cost per free user computed from their numbers; tourists separated from prospects; each option argued in dollars not adjectives; one recommendation with a 60-day watch metric
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