 Free no more - investigating customer reactions to unexpected free-to-fee switchesGerrit Paul Cziehso, Tobias Schaefers and Monika Kukar-Kinney Journal of Business Research, 2019, vol. 101, issue C, 229-242 Abstract: Many companies struggle with the consequences of introducing prices for previously free services, known as free-to-fee switches. We compare an unexpected forced free-to-fee switch, in which continued usage is only possible if the fee is paid, to a freemium switch, which entails the option to use a service with reduced features for free. Integrating price fairness theory and the concept of cannibalization, three experimental studies reveal detrimental effects of free-to-fee switches on fairness perceptions, attitude toward the company, and purchase intentions, which may partly be attenuated by a freemium switch. Furthermore, we examine different levels of feature reduction as a way for improving the effectiveness of free-to-fee switches. Overall, the findings question the common practice of unexpectedly introducing freemium business models, contribute to a better understanding of customer reactions to free-to-fee switches, and provide recommendations for companies intending to introduce a price for free services. Keywords: Free-to-fee switch; Freemium; Price introduction; Price fairness (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:101:y:2019:i:c:p:229-242 DOI: 10.1016/j.jbusres.2019.03.050 Access Statistics for this article Journal of Business Research is currently edited by A. G. Woodside More articles in Journal of Business Research from Elsevier |
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