The main reason why startups provide a free trial period to their customers is to convert them to pay at the end of the trial. The biggest challenge most companies face is to decide the length of the trial period. Another important question that many people have is, if it is even necessary to have a trial period in the first place. The answer to this question for most software businesses is a resounding ‘yes.’
SaaS companies should avoid following one-size fits all trial length, as it won’t work for many businesses. Understanding the pros and cons of a long and short trial period is essential to determine which one would fit well for your company.
It’s necessary to understand what your direct competitors are doing. In an independent study, results revealed that more than half of the companies have a 30-day trial period while less than one-fifth of the companies have a trial period of two weeks.
These are some of the factors that you need to consider when deciding on a trial period:
The time it takes for the user to understand your product.
Is the time sufficient for the user to understand the features of the product and can he or she decide during the trial period that it is the right fit for his or her need?
How is the trial length going to affect your sales cycle?
Duration of time wherein you can financially support a trial period. Be as realistic as possible.
A Good Trial Period Boosts Your Business
Short Free Trial Period: You may consider a trial period of two weeks or less as a short free trial period. For some of SaaS companies, it is the ideal time for users to decide whether or not they should buy the product. But some people think that the period is too short for the users to make a decision. Listed below are few of the benefits that a business can enjoy from having a short trial period.
The Sense of Urgency: Those who advocate using a shorter trial period believe that the users will be more anxious to use a product when there is very less time at their disposal. If you want the users to convert to become paying customers quickly, it is necessary to have them engaged in the product soon. The users who are more actively using the product in the first three days of a product is more likely to become your paying customer.
Increase Sales Per Salesperson: When you have a shorter sales period, the salesperson will have fewer prospects that they need to manage and can, therefore, be more attentive.
Reduce Sales Lifecycle And the Associated Costs: When there is a shorter free trial period, it also means that you are supporting it for a shorter period financially. Now, it will significantly reduce customer acquisition costs (CAC). If your business is growing, the impact of CAC will also increase drastically, and reducing CAC is an important consideration.
Kashflow changed their trial period from 60 days to just two weeks. As a result, they saw an almost 25% increase in customer conversions, which is excellent. Most of the users do not prioritize the product when you give them too many days to decide. When the trial period is limited, they make it top priority to check the product the moment they register for it.
Extend It If Necessary: If you are one who is concerned that the shorter trial period may not work well for you, you may consider extending it for few people that have a genuine interest in your product. You may choose to do this by sending in a personalized email. When you do this you will be surprised at the number of responses from people who are interested in extending the trial period.
Long Free Trial Period
A trial period that is longer than two weeks is considered a long trial period. Of course, longer trial periods are expensive for the company. But it might be the best option when the products that you are selling are complex and require more time for the customers to understand.
There is also a concern for many of the companies that extending the trial period may allow the users to delay their decision of using the product. Here are some excellent reasons why you may want to opt for a long free trial period:
Users Learn to Use the Product: If you developed a complex product, giving a longer trial period to the user will be beneficial. They will effectively learn how to use the product if they utilize the full trial period.
Less Pressure: If you are targeting customers who are busy professionals, it is wise to provide them ample time to decide. They will not be pressured to buy something from you as a result.
Product Becomes Sticky: This is one of the main reasons why you may consider this option. Users love to pay for applications that are indispensable and those that become an integral part of their life. If someone has spent two months learning and integrating a product, they are much more likely to recognize it as beneficial and worth purchasing. Constant Contact is using this strategy to convert more trial users into paying customers.
These are the pros that you and your company can enjoy choosing a shorter trial period or a longer one. Talk with your team to pick one that is a good fit for your requirement and your product. It is also a good idea to combine both of the options at times depending on the product that you are planning to sell. Another way to see which option will work well for you is conducting an A/B testing with both a long and short trial period.