Why many free trial offers fail


Note: This post was also featured on building43

For many SaaS vendors  offering prospects a free trial seems to be the prescribed route of getting the customer on board.  Many marketing & sales executives dictate to their team that this is the key goal they should push for with all their prospects in order to convert them into paying customers. What many vendors don’t realize is that this process in many cases is flawed and if not properly managed, could be costing them the loss of the most qualified customers.

Case in point: a while ago we were in the market for a CRM software.  I had allocated a budget, we were ready to buy immediately, and were looking exclusively at SaaS Vendors.  We were a very qualified “A” type lead. We figured it would be an easy process – there were several vendors that seemed appropriate and I thought that all we needed to do was to figure out which one of those best met our needs, and then give it a try. That’s when we realized the huge gap in the “free trial” process that many companies have…

The Problem with the Free Trial Process: Several years back, a free trial in SaaS was a great benefit for customers who’s alternative was to go through long sales presentations, in-house demo installations, and making a leap of faith in buying and implementing expensive installed software.  Instead they just took a free trial from the few SaaS vendors that were offering it at the time and it worked great.

But then things changed.  Then every SaaSy Tom, Dick, and Harry started offering free trials and the tables turned. If we (the vendors) want to be realistic about free trials today – it’s not the vendor that is giving the customer a free trial, it’s the CUSTOMER that is giving the vendor a free trial!  With all the options customers have today, telling them that you’ll give them a free trial for a month is no longer a gift, it’s a task.  From the customer’s perspective, she’s been offered that free trial from your 6 competitors as well and she needs to decide where she will spend her time.  If you push hard enough, she might sign up for your free trial but never use it; the real measure is trial usage – if you can get a customer excited enough to actually use a free trial then you’ve got a seriously qualified prospect.  The irony is that in many cases qualified prospects refuse to sign up or use the free trial, and this is because they have not been given the information that convinces them that the solution is right for them, so they refuse to waste their time.

That’s what happened with us and many CRM vendors.  Those that did not have the prepared resources to help answer our questions BEFORE the free trial were simply disqualified, because we were not about to run 6 different vendor applications through proper trials.

Here are some facts

  • Every SaaS vendor is offering free trials. It’s no longer unique nor is it a benefit, it’s a task for the customer.
  • When a customer decides to actually use your software in trial mode, she is the one that is giving you the free trial, not the other way around
  • The real measure of success is not free trial signup, but free trial usage.

Making the free trials work

  • Our task as vendors is to rise above the noise of our competitors.  Assume your customer has been offered a free trial by all, and make sure to give him much more– give him access to a rich & graphic set of resources that provide the answers & information he is asking for.
  • Make your information useful.  Overview presentations are nice, but they are high level.  White papers are boring – and its doubtful that anyone reads them.  A rich library of to-the-point presentations & movies will do wonders for you.
  • Be respectful of your customer’s time.  When a customer is first looking at your website & product (before taking the free trial), assume you will get a very limited time slot.  What do you prefer that the customer do in that time, read one whitepaper or see 10 movies/presentations covering different aspects for your solution?
  • Track and measure your customer’s usage of materials & resources you make available to them, as well as the free trial usage.  You will see a direct correlation between the resources used, the free trial usage, and prospects becoming customers.

If you do these things, you will be able to give the customer the value that he is looking for, and the warm and fuzzy feeling that your SaaS solution can address his needs.  The next step will be real free trial usage, and a happy & paying customer.

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    • thecynicalmarketer
    • February 21st, 2010

    Great post and an absolutely spot-on perspective!

  1. Benny, Absolutely right perspective! Free trials are in the past. In my view, industry will be moving into two directions FREE and COOL (http://plmtwine.com/2010/02/02/free-and-cool-trends-in-cadplm/). So, either you will get software for free, or you will be paying a lot for really cool stuff. Best, Oleg

    • Very true! Makes a change to see soenmoe spell it out like that. 🙂

    • BennyShaviv
    • February 21st, 2010

    Well, I do think that free trials are good, its just the method of pushing a customer into a free trial that is no longer working, simply because you cant take a virtual piss anymore without wetting a SaaS vendor offering a free trial. customers cant be expected to run 6 free trials in parallel. they need good info before, info that makes them believe that this software is right for them, and then the free trial will work its magic.

  2. So, what’s the point? To provide lot’s of information? It makes sense. I’d say, in addition, product blog and youtube channel can be a very good addition to free trial. Best, Oleg

    • AmirT
    • February 23rd, 2010

    KOL MILLA BASELA.. 🙂

    Interesting & Inspiring. Thanks.

  3. Thanks for this great article. This article was very informative since I am in the process of launching a campaign with or without free trial.

    I am currently in charge marketing our self service daily deal creation engine. I will say our tool is a combination of Adwords + Groupon, where any merchant can sign on, bid on the customer, and start a campaign.

    I had proposed that we do some sort of Free Trials by giving customer free advertising budget like Google Adwords. My teammates have come back with arguments such as
    1. I dont believe in Free Trials
    2. It is going to make us look desperate
    3. We are already cheap enough, we dont need to provide free trial.

    Would you please let me know how I should be approaching this issue? Do they have valid points where I am just being stubborn? Pleas show me the light

    – From very frustrated marketing newbie.

    Thnk you.

      • BennyShaviv
      • March 12th, 2011

      Since you are launching a new service, the first question you need to answer is what marketing offer could you come up with that would provide customers with value that is obviously above & beyond competitors. This is the most important issue. The better you can answer this, the better chance you have and less you will have to spend (time & money) on promoting the offer. The good news is that it does not have to appeal to every potential customer. Try to figure out a niche (vertical, regional, whatever) where you can dominate with this proposal. Even if its only relevant for a small subset of your potential market (e.g. 4 week program, online-computer-stores-only, in your City only, free adwords, dinner at the end of the 4 weeks where the best seller gets a new iPod and 1 more iPod is drawn in a competition… get my drift? small budget, big benefits, real incentive to seriously participate).
      Regarding the details of Yes/No free trial: do your competitors offer free trials? is it a big benefit to the customer if you give them the free trial, and would the results be immediately evident? does it require some form of commitment from the customer? You need it to be a benefit AND require some form of commitment from the customer (does not have to be in hard cash, can certainly be an investment of their time)
      Another very important issue – you need to get going fast. Work out a reasonable plan that makes sense (call potential customers and ask them what would get them to try… you will discover hidden gems) and then try it. You are running a new business, and the truth is that neither you or anyone else knows yet what will work for you and what wont. You need to make the very best assessment you can, try it, measure the results as much as you can, and adjust. Reality is the best teacher, and many successes come on the 3rd try. So dont hesitate, otherwise you will run out of steam (financially). Plan on having a plan B and plan C, and get out there and try it. And dont worry about how any marketing plan makes you look – the important thing is for it to work. Try, mesure, improve, try, measure, improve, etc.

  4. I have been looking for information on businesses trying free trials. I am glad I found this information. Thanks for the post.

  5. I have been writing SaaS reviews (@http://www.saasmash.com/). Part of it is downloading the SaaS and evaluating it. What is so annoying is the incomplete features it offers. Thus making it to fail.

  6. have been writing SaaS reviews at http://www.saasmash.com. Part of it is downloading the SaaS and evaluating it. What is so annoying is the incomplete features it offers. Thus making it to fail.

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