# 14 - Freemium Business Model Implementation ## Executive Summary This document details the Package-based business model for the Fotospiel tenant app, combining free access with purchases of predefined packages. The model prioritizes user acquisition through a free test package while monetizing through value-driven upgrades. Key metrics: 5-10% conversion rate, ARPU €10-15, scalable to 100k+ users. See 15-packages-design.md for package details. ## Model Analysis ### Model A: Paid App (€4.99) with Free First Event **Pros:** - Higher paying user conversion (20-30% retention) - Premium perception for professional users - Stable revenue from app sales (70% net after store fees) - No freeloader problem **Cons:** - Lower acquisition (lower than 5% download conversion) - High churn if first event doesn't impress - Slower scaling, higher marketing costs per install (€2-5) ### Model B: Free App with In-App Purchases (Recommended Base) **Pros:** - 10x more downloads, viral potential - Low acquisition costs (€0.50-1 per install) - Flexible pricing (starter €4.99, pro €9.99) - Better App Store ranking for free apps **Cons:** - 80-95% freeloader rate - Complex IAP setup and testing - Requires strong onboarding to drive conversions ### Package-based Recommendation **Core Strategy:** Free app with limited test package for first event, upgrades via package purchases (Einmalkäufe for Endkunden, Subscriptions for Reseller). **Pricing Structure:** See 15-packages-design.md for Endkunden (pro Event: Free/Test 0€, Starter 19€, etc.) and Reseller (jährlich: S 149€, etc.). - **Free Tier:** Test package (30 photos, 10 guests, 3 days gallery, 1 task, standard watermark) - **Endkunden Packages:** Einmalkäufe pro Event with increasing limits/features. - **Reseller Packages:** Annual subscriptions with event limits and branding options. **Expected Metrics:** - Downloads: 50k/year - Conversion: 5-8% (2,500-4,000 paying users) - ARPU: €12 (mix of one-time + recurring) - Annual Revenue: €30,000-48,000 (after 30% store fees) ## User Acquisition Strategy ### App Store Optimization (ASO) - **Keywords:** "Event Foto App", "Hochzeit Galerie", "Party Foto Sharing", "Event Planner kostenlos" - **Screenshots:** 5-6 screens showing value (event creation, photo upload, QR sharing) - **Description:** 4,000 chars emphasizing "Free start, upgrade anytime" - **App Preview Video:** 30s demo of creating/sharing first event ### Marketing Channels - **Paid Ads:** Facebook/Instagram targeting wedding planners (€1-2/install) - **Organic:** Wedding forums, photographer communities, local event groups - **Partnerships:** Affiliate program for event agencies (20% commission) - **Content Marketing:** Blog posts "How to create digital photo galleries for events" ### Retention & Re-engagement - **Push Notifications:** "Your event ends soon - extend for €2.99" (opt-in only) - **Email Marketing:** Post-event surveys with upgrade offers - **In-App Messaging:** Contextual upgrade prompts after value demonstration ## Conversion Optimization ### Onboarding Funnel 1. **Download → First Launch:** 90% completion target 2. **Onboarding Wizard → First Event:** 80% completion 3. **First Event Success → Upgrade Prompt:** 10% conversion 4. **Repeat Usage → Subscription:** 20% of one-time buyers ### A/B Testing Plan - **CTA Text:** "Get Started Free" vs "Create First Event" - **Pricing Display:** Static prices vs dynamic local currency - **Upgrade Timing:** After first photo upload vs after event sharing - **Tools:** Firebase Remote Config + RevenueCat Experiments ## Technical Requirements ### Frontend (React/Capacitor) - **IAP Integration:** RevenueCat SDK for cross-platform purchases - **State Management:** Context API for credits, React Query for API sync - **Offline Support:** Capacitor Storage for temporary event data - **Analytics:** Firebase for funnel tracking, RevenueCat for purchase events ### Backend API Extensions - **Package Management:** `/api/v1/packages` and `/api/v1/tenant/packages` endpoints - **Purchase Validation:** Webhook receiver from Stripe - **Event Limiting:** Middleware checking credit balance before creation - **Subscription Sync:** Real-time updates via WebSockets (optional) ### Database Schema Additions See 15-packages-design.md for updated schema: `packages`, `event_packages`, `tenant_packages`, `package_purchases`. ## Risk Mitigation ### Store Compliance - **No Paywalls Before Value:** First event creation always free - **Clear Descriptions:** App Store screenshots show free tier capabilities - **Receipt Validation:** All purchases server-side verified - **Refund Policy:** 14-day money-back for subscriptions ### Technical Risks - **IAP Failures:** Fallback to manual credit allocation via support - **Sync Issues:** Offline-first approach, sync on reconnect - **Store Rejections:** Beta testing with TestFlight/Internal Testing - **Revenue Recognition:** Use RevenueCat for proper accounting ### Business Risks - **Low Conversion:** Monthly A/B testing and user surveys - **Churn:** Re-engagement campaigns for inactive users - **Competition:** Regular competitor analysis and feature updates - **Platform Changes:** Monitor Apple/Google policy updates ## Launch Timeline ### Phase 1: MVP (4 weeks) - Week 1: RevenueCat integration, basic credit system - Week 2: IAP store page, purchase flow - Week 3: Backend endpoints, database schema - Week 4: Testing, beta distribution ### Phase 2: Optimization (Ongoing) - Month 1: A/B testing of upgrade prompts - Month 2: Push notifications, email marketing - Month 3: Subscription model introduction - Quarterly: Feature updates based on user feedback ## Success Metrics ### Acquisition - Downloads: 10k in first 3 months - Cost per Install: less than €1.50 - App Store Rating: more than 4.5 stars ### Conversion - Free → Paid: 5% within 30 days - First Event → Upgrade: 15% conversion - Average Order Value: €8-12 ### Retention - Day 1 Retention: more than 40% - Day 7 Retention: more than 25% - Monthly Active Users: 20% of downloads ### Revenue - Month 1 Revenue: €1,000-2,000 - ARPU: €0.50-1.00 overall - LTV more than 3x acquisition cost This Freemium model balances user acquisition with sustainable revenue growth, leveraging the event-based nature of the app for recurring purchases while maintaining an accessible entry point.