How to Increase SaaS User Conversions from Free Trial to Paid Plans
There is a fantastic debate going on about which free-plan is better for SaaS –Freemium or Free Trial? The decision should be based on the type of service you provide, the type of users and the user-base size you are aiming for. The Freemium model aims for a very large user-base and is best suited for a simple service, probably a B2C service. You can read more about increasing SaaS user conversion from Freemium to paid plans. Free Trial services usually market a service that requires more intricate onboarding and while the conversion rates are typically higher, the process is more intensive and more natural to B2B.
When deciding which free-plan model would best suite your SaaS offering, here is what you need to keep in mind: while Freemium users are primarily free users who may, at some point in the obscure future, become paying customers – Free Trial users arrive at the using starting point with the willingness to pay for the service.
The process of committing time and cognitive resources to the software is entwined with a growing readiness to commit to it financially. What does that mean? That the Free Trial model requires a seamless engagement flow, like so:
Attraction —> Onboarding —> Conversion
Free Trial software services do not have the luxury of separating the onboarding process from the conversion tipping point. That said, there are several stages along the way that require highlighting:
Follow up, Communicate, Reach Out
The consensus across the board is that the main reason for abandonment right after signup is lack of follow up on the vendor’s part. This is a stage that is quite easy to implement at this day and age, so that even an automated response can be customized to relate a personal touch. Totango have some pretty interesting stats to offer about the user engagement price of dropping balls in the SaaS industry.
The 3 finishing touches that help deliver the message more effectively:
- Personalize – both the salutation and the signature should be personalized. A person reaching out to another person is more likely to leave a mark than a company contacting a “Dear user”.
- Style – write a respectable email, reminding the user that her registration did not go un-noticed and that you consider her time as precious as she should consider yours.
- Call to action – make sure the activation is a click away.
Don’t Measure Everything
Measuring EVERYTHING is an extremely wasteful use of your time and of your staff’s time. Instead, focus on specific metrics which results you can implement into any tweaks you make to your process. Lincoln Murphy at SixteenVentures offers his interesting CCA metric, which measures what paying customers do. An obvious alternative is to measure what abandoning users did before abandoning (Users, not to be confused with Leads who signed up but did not complete the activation process).
Take Your Onboarding Seriously
Successful onboarding is in itself a form of art. It requires a perfect combination of attentiveness to end-users, well balanced persistence in reaching out to them and acute attention to analytics. If you are looking for onboarding tools to boost your success rates in onboarding, read more about Iridize’s experience and proven success in SaaS onboarding.
Again, the Free Trial model is based on the notion that the user enters the trial with a willingness to pay for a service, you just have to convince them it is your service they should pay for. Onboarding is a critical in this regard, because the user is not only checking whether she is happy with your service – she is scrutinizing to see whether she is happy enough to pay for it.
Follow-Up is Key
If all went well, the formality of getting the user to part with her money should be just that: a formality. Supposedly, the decision is made, now it’s up to you not to botch it up.
The few things to remember in regard to the Sales:
- Don’t pounce – make the conversion process a gradual one. Send reminders at a growing frequency toward the trial end date, so it doesn’t come as a surprise.
- Compensate early converters – offer a discount or some substantial bonus for users who convert early. If it’s measurable (e.g. discount per days) – present the users with the math.
- Make the pitch – no, really, make it. After having prepared the field for days or weeks, make sure the conversion is a click away. Don’t throw it all away on a laconic email informing that the trial has ended.