Salesforce.com Acquires DimDim: Stops Freemium Model In March
January 06, 2011
I received an email today from DimDim informing me that they are switching off my free account in March, along with the news that Salesforce.com is acquiring DimDim. Is it me or could this combined annoucement have been handled a little more softly?
Here's the email I received:
Dimdim has been acquired by salesforce.com. Your free Dimdim account will remain active until March 15, 2011. After that date, you will no longer be able to access your free Dimdim account.
Please see the Frequently Asked Questions (FAQ) for additional information.
We appreciate your understanding, and we thank you!
The Dimdim Team
Not exactly the most personal of emails to a former customer, even if I was free loading, plus, there was no information about options for upgrading the service.
The switch from freemium model to paid reminds me eerily of the Ning changes last year. If you recall Ning dropped their free accounts, but in a way that was generally agreed by the industry to fumble their communications tactics around the announcement. Here's my post about Ning, "Ning Removes Free Community Support, Fumbles Over PR Communications Strategy."
I've used the DimDim service before, but I'm not a regular user, plus I know people at the company, I'm very happy for the purchase especially for the employees of DimDim. However, the timing of the acquisition news with the notification that the free service will be dropped, seems like a PR fumble to me. Plus, the content of the email I receive appears to be receiving some poor marks from the community.
Treena Grevatt of @tgrevatt
"There seem to be a few fumbles over tech press releases lately. Will be good opp for rivals. Already been tweeted by one."
Adele McAlear of @AdeleMcAlear
"Notifying users was good - you can't keep that a secret. But the email was very impersonal and poorly written. "Dear customer...""
Scott Kaye of @sbkaye
"SFDC buying some neat cos/tech (practice fusion, dimdim). prob a great deal for dimdim to be acquired. no style pts for anncmt"
And searching through a number of other tweets on Twitter Search opinion appeared to be moderately negative towards the news about the dropping of the free service.
Case studies like Salesforce.com with DimDim and Ning illustrate the perils of choosing between the right business model for a viable company, and breaking bonds with your community. Ning had a pretty bad backlash against their move to drop free. Many nonprofits were using the service, and Ning eventually compromised with some solutions. But for the Ning service it was obviously a ding to their reputation.
I don't think the DimDim Freemium cancellation is anywhere near the scale of the issues Ning had in terms of PR crisis, but the case study does illustrate that companies have to be very careful when delivering bad news, both in timing and how the news is delivered.
The acquisition and cancellation also gives Freemium a bad name, and perhaps gives anyone pause for believing a Freemium company's promises. For customers using Freemium products, be warned that service you use may go away. Don't expect the service to always be there.