Like most people, you probably start your free trial of a new service with the best of intentions. But life gets busy, and your trial period is up before you know it. If you don’t take action to convert your free trial into a paid subscription, then you’ll never get to experience the full benefits of the service. So how can companies increase their free trial to paid conversion rates? Here are four tips:
Free Trial to Paid Conversion Rate
The free trial to paid conversion rate is the ratio of the number of people who sign up for a trial to the number of subscribers who eventually convert into paying customers.
This is one of the most important metrics to track because it shows you how effective your trial is in getting people over the finish line and paying for your product.
What is a good free trial conversion percentage?
A free trial period gives your user base a chance to try your software out before they commit to buying it. This allows them to get a sense of the functionality and advantages of your platform. Just make sure your trials are long enough to let them get a feel for your service.
How long should your free trial be? It depends on the complexity of the product or service you’re offering.
While outsourcing your call center can be a great way to save money, you’ll still need enough resources to run it.
What kinds of free-trial exist in SaaS?
There are two types of trials: those requiring credit card details and those that don’t.
Here’s how it works:
A free trial is a period during which a potential customer can try out a product for free. There are different types of trials, such as opt-in, opt-out, and limited time.
Which is better for marketing: opt-in or opt-out?
The best way for a product to generate buzz is through an opt-in free trial. This requires no commitment or risk, so people are more likely to try it out.
If customers experience the Aha moment during the trial period, they will stick around longer, resulting in the highest CLV.
If you want more sales, you’ll have to spend more on customer education. This will increase the number of people who enter your payment information, but it also means you’ll have lower conversion rates than if you offered an opt-in trial.
While opt-out trials are a good way to generate new sales, they sometimes result in fewer sign-ups because no one wants to enter their credit card details for something they haven’t heard before.
If you’re looking to fund a new product or service, an opt-in free trial is best. This allows you to get potential customers to try out your product or service before asking them to pay for it.
If you want to take your established product or service to that next level of growth, an opt-in free trial might be the answer.
Which is better for a free trial – unlimited or limited?
With the free trial, users have access to all the available features so they can choose a plan that best suits their needs. There is a catch, however.
The challenge with free sample offers is that some people will create multiple accounts or use fake email addresses to keep using the product without paying for a plan. This can be a problem if too many people abuse the system.
A trial with limited features may keep out spammers but may also limit your customer base to those only interested in the specific features of your software.
It’s important to include all of the features that a user needs to get value out of using your app in your trial version.
If the features don’t impress the user, you’re only hurting yourself more in the long run.
How do you calculate a free conversion rate?
You can calculate the rate of your paid conversions by calculating how many customers you have at the end of your trial period.
To figure out your trial conversion rate, use the following formula:
The conversion rate from trial to paying customer.
Let’s say that 500 people signed up for your free trial and 90 of them ended up purchasing. Your trial period conversion percentage would then be 15%.
18% of 500 is 90.
What’s an optimal free trial to paid conversion rate in SaaS?
Let’s look at some benchmark numbers.
Have you ever wondered if your company is converting enough trial users into paying customers? Or maybe, if it should be doing a lot better?
While it’s beneficial to see where your company ranks among others in the SaaS industry, it’s important to remember that “SaaS” has become an umbrella term for businesses that offer cloud- or web-based services. This means that different companies can have very different conversion rates and still be successful. Factors such as market, product category, and how the free trial is designed can all play a role in conversion rate variation.
The rate at which people convert from a free trial to a paying customer can vary greatly depending on your market and your product.
When signing up for a product’s free trial, requiring credit card information usually results in more conversion rates because fewer people will waste their time at the top of the sales funnel.
According to one study, the average trial to paying customer conversion in software-as-a-service (SaaS) businesses is between 1-15%. This rate varies by industry, however.
How do you know if it’s still worth testing your approach on a free trial?
Double down on your optimizations if you’ve tested a backlog and are seeing decent results.
If you’re seeing small, insignificant increases in your conversion rate with each new experiment, it may mean that you’ve reached your maximum potential. In this case, you should either start testing bigger things, like trial length or packaging, or move on to other business areas, such as acquisition or retention.
So, how long should your free trial be?
Even if you have the best SaaS product available, you still need to put effort into getting users to convert into paying customers. The process needs to be designed in a way that will guide the user towards conversion.
This process involves thinking through and designing the user experience to guide users in the desired direction.
But how can you do this? What factors determine whether or not a user will convert to a sale?
How to Monitor the Free Trial to Paid Conversion Rate
When you offer free trials of your products, you give customers a taste of what your business has to offer. By tracking the conversion rates of trial users to paying customers, you can ensure that customers are satisfied with your offerings and that your company is profitable.
But, there is a significant risk of losing money. You invested time and money into creating a product, and you can’t get that back if no one buys it.
If you want to increase your revenue, you should focus on converting more trial users into paid subscribers.
It is that simple.
Another way to think about it is:
It is critical to monitor the Free trial to Paid conversion rate to improve conversions and increase recurring revenue. You can build trust with potential customers by improving customer engagement and turning them into paying customers.
Customers who sign up for a trial are a good target for marketers because they are already interested in your company and have provided you with some information.
How to Improve Your SaaS Free Trial-To-Paid Conversion Rate
It’s important that when you’re marketing your trial, you make it engaging enough so that users will see it as the best solution for their needs.
If your conversion rate is 8%, that means 92% of your customers are not converting.
Many customers complain that their poor customer service experiences stem from bad initial interactions with their companies.
There are a few things you should do to optimize your trial-to-conversion rate:
1. Interactive Tours
An Interactive Walkthrough is a fantastic way to guide new users through their first experience with your product or service. By following a user’s journey through your features, you can ensure that they have everything they need to hit the ground running.
An on-boarding process is usually an instructional tool that appears as an overlay on the user interface and guides the user on how to use your product to achieve your desired outcome.
For successful user onboarding, you need first to understand what success means for each segment of your users. Only then can you create a successful user experience that leads them all to that outcome.
2. Checklists to Help Convert More Users
Checklists are a great way to encourage your users to complete the user onboarding process.
No company’s employee training process is perfect, so it’s important to test and iterate your processes constantly.
At user pilot, you have several tools available to help you turn more visitors into customers.
3. In-app surveys
By conducting short surveys, you can gather valuable customer feedback directly. This can help you improve your product or service, ultimately leading to more conversions.
MicroSurveys can help you improve user engagement and boost your free trial-to-paid conversion. With 16 templates to choose from, you’re bound to find at least one that suits your needs. So start using it right away!
Here’s one way to increase your free trial to paying customer rate. You can proactively reach out and help your users before the 30 days. This gives you the ability to follow up and make sure they make the right decision.
Ask survey participants what’s stopping them from upgrading to a paid plan. Also, ask if they’re aware of any discounts or promotions.
If you follow these four tips, you’ll be well on your way to increasing your free trial to paid conversion rate. By using the service regularly and getting familiar with its features and benefits, you’ll see the value in upgrading to a paid subscription account. And by taking advantage of special offers and discounts, you can save money while still getting access to all the features and benefits you need.
Need Help Automating Your Sales Prospecting Process?
LeadFuze gives you all the data you need to find ideal leads, including full contact information.
Go through a variety of filters to zero in on the leads you want to reach. This is crazy specific, but you could find all the people that match the following:
- A company in the Financial Services or Banking industry
- Who have more than 10 employees
- That spend money on Adwords
- Who use Hubspot
- Who currently have job openings for marketing help
- With the role of HR Manager
- That has only been in this role for less than 1 year
Want to help contribute to future articles? Have data-backed and tactical advice to share? I’d love to hear from you!
We have over 60,000 monthly readers that would love to see it! Contact us and let's discuss your ideas!