The freemium model is a popular business strategy, particularly in the area of digital services and software products. In this model, basic functions of a product or service are offered free of charge, while extended functions or premium services are available for a fee. The word "freemium" is a portmanteau word made up of the terms "free" and "premium".

The main advantage of this model is that it allows users to test the product or service without financial risk. This lowers the barriers to entry and promotes the rapid spread of the offer. As a rule, the freemium strategy aims to build up a large user base and convert some of these users into paying customers. This is particularly effective if the product or service has a high level of virality and network effects, as existing users often recruit new users.

The customer experience plays a decisive role in the freemium model. Companies need to carefully consider which features to offer for free in order to attract new users and incentivise them to switch to paid options. Finding the balance between an attractive free offer and valuable premium features can be a challenge.

The freemium model is also known for its psychological aspects. The free basic version often serves as a "gateway drug" that builds an emotional bond with the product and awakens the desire to experience even more of what the premium version has to offer. This makes switching to the paid version more likely.