You can have droves of people following you on Facebook and thousands of newsletter subscribers, but those people won’t do you any good if you’re not converting them into paying customers. You need a conversion strategy.
3 Kinds Of Free
Not all free accounts are the same, but there are some common variants of free. Three of the most common kinds of free accounts are:
- Ad supported – Some companies are opting to help monetize free accounts by selling and displaying advertising to their free users.
- Freemium – Freemium accounts are provided free of charge, but have limits placed on the features that are available. Once you decide you need the advanced features you need to upgrade your account and pay a premium.
- Trial – In other cases, SaaS companies will offer a 30, 60 or 90 free trial. This lets people get in and get addicted to the product. Sometimes the trial account is also used as part of the freemium model. For example, Hootsuite offers a free account and then offers a free trial of its premium product.
SaaS companies face some unique challenges when it comes to converting people from these free accounts to paid users, I wanted to share some of the tricks I’ve learned along away as well as some of the advice that was given to me.
Converting Free Users into Paid Users
These are ways to gather up free users, but you really need to focus on converting your free users to paid users. It’s the only way you’re going to pay the bills.
Converting these users into paying ones means you need to pay attention to them and their behavior and engage each user in real-time as much as possible
Here are five tactics to help you convert free users to paid users:
1. In-App Dynamic Messages
Offer personalized in-app messaging to handle common customer concerns or questions before they become issues that would make people stop using your app.
In-app is more effective because it’s always in-context, so users are thinking about and interacting with your app when they get the message. When a customer is using your app, personal messages can help them discover new features, increase customer happiness, and even introduce them to premium features.
2. Use An Email Drip Campaign
While drip campaigns are not as effective as in-app messages, they can work. For a drip campaign to be effective, it needs to be well-timed and relevant. When this occurs, it will deepen your relationship with that user.
After an in-app welcome message, a welcome email is the next thing a new user should get after signing up. The purpose of the welcome email is (of course) to welcome new users and help them through the onboarding process:
- Make the e-mail personal
- Let your users know you’re glad to have them
- Tell them how you are going to solve their problems
- Use a call-to-action back to send them back to your product so that users take the next step in the onboarding process
While these can be done effectively, they can also be poorly done. Drip campaigns run into certain problems:
- First, they assume a rate of adoption that might not actually match that individual user’s behavior.
- Second, if people see too many emails from you they start to mentally block them out and become indifferent.
You can avoid these problems by having emails triggered by an individual user’s behavior instead of just some predetermined rate of activation and by ensuring the email people receive is as targeted and personalized as possible.
Your goal with this type of campaign is to get users to see the core benefit of your product as soon as possible because people will pay you if you offer something they need.
3. Measure And Increase Customer Engagement
Engaging customers will directly affect your conversions. Identify a set of events or interactions that are necessary for engagement and start tracking those for each user. Look for patterns in your data and use this information to anticipate whether users might upgrade or leave.
Are you seeing lagging numbers for a certain user? Maybe a message sent to them while they are using your app could turn their relationship with your product around.
Do you have a very engaged premium user? It may be a good time for an upsell or cross-sell.
4. Use A Sales Team
Depending on your product and its price point, you might be able to have a sales team do some footwork for you, too. To make your salesforce even more effective, equip them with the information you’ve collected while tracking behavior and engagement – they’ll spend less time getting to know the customer and will be better prepared to close the sale.
5. Make Your Free Plan Good, But Not Too Good
This seems contradictory at first. Wouldn’t you want customers to have the best experience with the free plan so that they are more likely to upgrade? Well, the problem here is you don’t want the free plan to cannibalize sales of premium plans.
If you give away too many features with the free plan, customers just wouldn’t need to pay for the premium plan. On the other hand, you don’t want to give them too little, or they wouldn’t even be bothered to sign up in the first place.
Hootsuite has a nice way of doing it. The free plan has plenty of features, a set number of social profiles and some basic analytics – all the normal user would need. But, as the number of profiles you have grows or if you start using it for your business, you’ll need more accounts linked, the ability to collaborate, and better analytics.
Counting the number of visitors to your site does nothing if they don’t convert eventually. All you’re doing is spending more time and money acquiring new visitors. Instead, try some of the ideas we shared here.
Want to take a deeper dive into converting free users to paid ones? Download our ebook Converting Freemium and Trials To Paid Customers.