Free-trials have been with us since the early days of direct marketing when consumers were sent products or magazines in the hope of enticing them to purchase (or subscribe) after the trial period ends. Free-trials have certainly evolved since those early days and have become a lot more sophisticated with the emergence of digital marketing.
In this post, we will focus on digital products, but a lot of the tactics we cover apply to physical products and services as well.
Why "Free-Trial" Offers Are Ideal For Digital Products?
When thinking about digital products we often think of SaaS products (e.g. Salesforce, Xero, Shopify, LinkedIn, etc.), software products (e.g MS Office, Keynote) and apps (iOS and Android), but there are many other forms of digital products. For example, online courses, magazine subscriptions, e-books, and so on.
Irrespective of the type of digital product you are selling, offering a "free trial" option in your conversion funnel greatly improves the chances of converting a lead into a paying customer.
Additionally, the cost of adding a free-trial customer is relatively inexpensive.
In general, the longer someones uses your product the more likely they are to keep it after the trial period has ended. Furthermore, free-trials reduce the risk to the consumer - this is especially important if you are entering a new market, and your brand awareness is low.
Conversion Funnel Example (With a Free-Trial)
To better illustrate the power of a free-trial let's look at a simple conversion funnel example. In this specific example, we are using Google Ads to build awareness and attract leads to our website (and the landing page).
- Google Ad
- Landing Page
- Free Trial Sign-up (Form)
- Trial period (30-days)
- Paying Customer
As we mentioned above, our campaign and conversion funnel starts with Google Ads (Step 1). The landing page (Step 2) covers our digital products benefits, features, and testimonials - the primary purpose of the landing page is to convert prospects into free-trial customers (Step 3).
In the context of this post, the trial period (Step 4) is the most critical step - this is where we need to make our product sticky, and ensure a good percentage of these free-trial customers convert into paying customers.
How Do You Make Your Digital Product Sticky?
Which specific tactics you use will depend on the digital product you are selling (e.g. SaaS vs. E-book); however, most of the principles are the same.
Assuming we are a SaaS (software as a solution) business, we may try these 4 steps to make our product sticky.
- Welcome campaign (e.g. welcome email)
- Onboarding (e.g. how-to articles or videos, tips, best practices)
- Nurturing (product updates, customer testimonials)
- Engagement (training, add-on features)
On the surface, these steps seem pretty straight forward, but the success or failure (conversion %) will primarily be driven by three factors 1) Content Quality, 2) Content Relevancy, and 3) Timing.
The quality of content is vital because a free-trial customer will make certain assumptions about your product and company based on these early communications. For example, if your onboarding content (e.g. how-to article) is well written and helpful then in your customer's mind your product manuals must be well written and helpful as well - extremely important to large enterprises with numerous stakeholders.
Firstly, we need to understand what our free-trial customers are looking for and not looking for. In our experience, free-trial customers are mostly interested in the user experience and core features; therefore, the free trial period is not the time to overwhelm them with features and details. Instead, focus on making the experience as easy as possible, provide examples, make your content feel personalized, and reduce the fear of the unknown - with social proof (e.g testimonials, customer stories, reviews, etc.).
Since many businesses struggle with "make your content feel personalized," let's look at an example. SaaS businesses will often ask for a "Title/Role" during the sign-up process. Why is this important? Because different roles have different needs, wants, pain points, and priorities.
The benefits and features we need to highlight during the free-trial period should be driven by the role (e.g. Designer, Marketing Manager, Project Manager, CMO, CEO). All of these roles are very different, so how they use our product will likely be very different as well; therefore, our free-trial "Welcome", "Onboarding", "Nurturing", and "Engagement" communication tactics should be tailored to a specific role. Simply put, a testimonial from a marketing manager should be sent to a marketing manager (someone they can relate to), and not a designer (someone they cannot).
Also, the type of communication you send out during the free-trial period should take into account data and analytics. For example, if you detect a red flag (e.g. product was not used in over a week), you may want to give those users special attention - to get them to re-engage again.
Most marketing automation software will have a default setting regarding timing. For example, when to send the first, second, and third email. However, this is only a guide; hence it is not optimized for your specific business.
The timing of your communication can make all the differences, so closely monitor your conversion funnel and percentages, and make adjustments. For example, what is your 'welcome email' open rate and click-through rate? How do we improve it? How does it correlate to our conversion percentage?
Small improvements over time will result in significant gains.
Are free-trial offers for everyone?
As we stated earlier, when it comes to digital products the cost of adding more users is relatively inexpensive, hence why most companies in the "digital product" space will include a free-trial offer in their lead generation and conversion funnel.
However, if you are in the business or selling physical goods or services then the cost can be significantly higher; therefore, these types of offers should be highly selective. For example, "free-trial" offers are only given to qualified leads that meet specific criteria.
The bottom line is, the free-trial offer has to make financial sense, and as is the case with any marketing campaign, a certain percentage of the marketing budget should be reserved for experimentation, but most marketing campaigns have to pay for themselves.
In most cases, a conversion funnel with a "free-trial" step will convert more leads into paying customers, because free-trials reduce the risk to the consumer.
If you are a well-known brand, then the risk factor is much lower - why most consumers buy from well-known brands. However, if you are a startup, or just entering a new market, then reducing the risk of the unknown is extremely important.
The free-trial dramatically reduces this risk and allows you to demonstrate why your product is better - when compared to your competition. The bottom line is, free-trials are effective because the longer someone uses a product the more likely they are to keep it (purchase it).