Free Trial Conversion
A study by SaaS industry research firm, Softletter, indicated that 66% of online companies surveyed had free-trial-to-paying-customer conversion rates of 25% or less.
Part of the problem is that many organizations don’t have good information about what a prospect is doing (or not doing) during their trial. It is as though the trial is a ‘black box’ that users enter. They pop out as either paying customers or lost leads.
Increasing this conversion rate can have a dramatic impact on revenue and profit by increasing the number of paying customers without increasing Customer Acquisition Cost.
Looking inside the black box
It is a user’s behaviors, actions, and engagement within the application itself that most accurately predicts a trial customer’s likelihood to convert.
In order to increase conversation rates, businesses must dig deeper into their customers’ actions in order to know:
- Is this customer using the product?
- If the customer is a business, is it one person or many people at a particular business who are using it?
- Is that customer using it frequently?
- Are they taking advantage of the right features given their objectives?
- Are they using the higher value, more sticky features
By finding a way into this black box, an online business can understand what their trial customers are doing and guide them towards features and activities that will demonstrate the value of the product or service they’re evaluating.
Responding to customers
Knowing what your customers are doing in your trial, their level of engagement, you can tailor your communication appropriately.
If they are high value, you can reach out personally by phone or email. Instead of spending the first 15 minutes of the call asking how things are going, you can provide immediate value encouraging them to take the next steps toward success with your solution.
If you cannot afford to call your customers, you can automate targeted emails such as:
- Encouraging them to take the next step
- Highlighting the value provided by a particular feature
- Asking them to return
- Sending case studies that are particularly relevant to what they have experienced
Even better than email, while the customer is engaged with your application, display these same kind of targeted messages directly in your application.
By understanding your customers’ behavior and responding appropriately to them, you can help them have a more successful trial, and increase the likelihood that they will convert to a paying customer.