Request to renew free SaaS - bad sign

Original author: Lincoln Murphy
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Should I go towards the client and extend for him the period of free testing of the service? Will it help to make a sale or is it a waste of time on someone who will never buy? Lincoln Murphy, SaaS Development Specialist, who helped bring more than 300 cloud-based startups to the market, shares his opinion. The story comes from the first person.

I received this question about requests to extend the free version of SaaS and decided to answer it here, in plain sight.

“Lincoln, I came across a recent post that says“ short trial versions + generous extensions of their deadlines ”are the starting point for sales. At the same time, you did not talk about it (unless I missed it). It struck me, because you most likely should have an opinion on this matter. I'm confused ... who is right? ”

Obviously, I'm right. [end of article. Joke! I will try to answer further using all my accumulated experience]

No, in fact, I believe that we are both right, but I look at this from a slightly different point of view. Although you can offer an ideal period of free testing from the point of view of most customers, as we wrote earlier in the article “Increasing site sales: how long should a free trial period take for a client to pay?”, However, there will always be those customers who want more.

I agree that if someone asks for an extension of the free version, then it's worth it.

However, such a request is an indicator or symptom of a deeper problem that we must try to solve.

Do not worry, I will describe in detail why I think so, and how to treat such symptoms and solve problems.

Generous extension of the free version of SaaS

It’s true, I never spoke openly about such an extension.

I'm not a fan of the free trial extension, at least the automated one.

I especially don't like stimulating renewals ... it's not freemium. Do not confuse these two concepts. Seriously, this is bad for your business.

Before extending the trial version of the application, I try to find out why the client needed this.

Renewal is better than losing a customer

Obviously, it is better to offer the client an extension or to satisfy his request in this, rather than not get money from him and lose forever. Problems arise when you extend the probationary period but haven’t changed anything else. No obligation. Well, you extended the period by 7 days, and then what?

Now let me explain. If you require confirmation of a credit card during registration, and I do this in extreme cases, then the client should refuse to use the free version if he does not want to use your service (unlike the opting-in model, where he does not refuse, but simply stops using it ) In the event of an active failure, you may ask: maybe the client just needs more time to evaluate SaaS?

Even if you have an automated registration and customer service system, when you receive a request to renew the free version, you need to switch to live communication and do two things:

  • Find out the reason for the request.
  • Encourage users to work actively during the extended period.

Reasons to extend the free version of SaaS

In my experience, the main reason for renewal requests is that the client was busy or distracted from working with the trial version and now wants to really work with the application.

Other reasons:

  • You need to consult with other people about whether to use the product and whether the service is useful for their company.
  • You need to give other people who were previously busy trying the software.
  • They have not yet finished evaluating other similar products and have not had time to make a choice.

None of these reasons is serious enough, and I will return to this soon.

How to process a request for an extension of the free version

So, you have decided to satisfy the request of your customers. But do not do it just like that, but try to do the following:

1. Find out why they need an extension.
2. Decide what is a “successful” test of your service for them.
3. Help them make an action plan for maximum success:

  1. make a plan for a specific client, if that makes sense in this situation;
  2. find out who else is involved in the work process and make sure that their activities will also be included in the assessment of your services.

4. There are clear steps:

  • You may need to apply general methods to them that enable you to turn the user into a client;
  • this should be agreed between you and the potential client;
  • this will ensure that both of you move towards a successful collaboration.

5. After success, ask about the purchase.

  • Well, if this happens on the third day of the 30-day trial.
  • By the way, this will help to avoid conversion for 31 days, with a 30-day trial period.

Now I will move on to why I believe that an extension request is a symptom of some kind of problem, and not just a whim of the client. This must be taken into account in advance when creating a product and determining the terms of use of the free version.

5 reasons why renewal requests are symptoms and not function

1. The free version is not adapted to turn users into paying customers.

The trial period alone does not make potential customers pay you money. In order to fix this, you need the following:
  • Simplify the process (I know your product is “too complicated” to simplify, but try to do this and you will be surprised).
  • Start with quick wins.
  • Manage the process along with general visitor conversion activities.
  • There is no need to make the work with the product too simple, but don’t complicate the life of the client ... confused visitors do not buy.

2. A potential customer does not succeed.

Contrary to the opinion of people whose free version of the product is not able to turn visitors into customers, people do not subscribe to the demo version to tinker with it for a long time. They expect, especially B2B customers, to immediately see the potential of the application and the justification of its value.

If they do not get to this point, then there are only two ways to develop the situation: they will ask for an extension of the free version, or you will lose them as customers. The first, most likely, will be a minority - those who saw the potential, but have not yet achieved success. Here are some ways to avoid losing customers:

  • Find out what the ideal trial period is for your customers and act on this information.
  • Organize the process of interaction with the client so that he achieves success.
  • Use your social capital effectively.
  • Create the correct welcome letter.
  • Use the correct set and sequence of trigger and drip letters for your customers.
  • Customer success should be your main goal not only in the free version of the product, but also in general.

3. Attracting the wrong users

These are customers who buy, but not from you, but from your competitors who provide similar services, but with different parameters and conditions. However, this does not mean that there is no need to fight for such customers.

If different products bring about the same results, then SaaS will be won by the supplier who organized the work more simply. Here are some things you can do to do this:

  • Understand who these customers are and create a product that will take into account their preferences.
  • Find out how they determine product quality and engage them based on that.
  • Define the pricing process and financial preferences of customers:
  • Provide the client finance director with a return on investment calculation along with a comparative table.
  • Provide the marketing director with calculations showing how they can achieve certain performance with your product.
  • Yes, and let customers share your product with others.
  • Come up with the right call to action that motivates the user to take the next step once he is successful.
  • Once a potential customer is successful, remind them to purchase your service.
  • Some of these things can be done based on the type / size of the company.

4. Attracting the wrong potential customers

If you have completed the previous three points, but there are still people who send requests for renewals, then try to think about this:

  • Are they your ideal customers?
  • Think about customer success while developing your ideal customer profile.
  • Consider customer success at all stages of cooperation with you.
  • If they could succeed in 6 months of working with you, but not with the free version, then you should reconsider your policy of providing a demo version of the product.
  • All the others, most likely, are not your ideal customers, and the extension will not lead to anything.
  • What stage are the sales funnels at? What level of awareness are they at? Etc.

5. The trial version is actually too short

Remember that the duration of the free period is just a marketing trick that is set artificially and serves to avoid the disadvantages of the freemium model.

But do not take this marketing ploy too lightly, as this can have serious consequences. For example, people simply will not use your service, considering that the free period is too short to appreciate all its advantages. Think about the following things:

Some users may ask you for an extension.

This is very important, as you can learn a lot:

  • This means that they did not manage to reach the planned point in the allotted time.
  • This means that they did not succeed with your application, and this may cost you a client.
  • It is likely that those requesting an extension are a minority. The rest will simply refuse to work with you.
  • The controversial point is “were those who did not ask for an extension real potential customers?”
  • My experience shows that yes, they were, they just did not succeed in working with you.
  • Some SaaS owners will justify the low conversion rate by the fact that many users simply did not intend to become their customers.
  • If so, great, but look at point 4.
  • Some customers will ask for an extension at the beginning of work, because they know that they will not have time to achieve results in the allotted time
  • If this happens frequently, then the free period is too short.
  • Think about how many people just left instead of asking for an extension.
  • Most people simply won’t ask you to renew and register, and this is a serious problem
  • This is not because people are “frivolous” and “unskilled”, but because you create various barriers and obstacles for them
  • Fortunately, if it is up to you, then everything can be fixed.

If all these measures are taken, then the symptoms of the problem should disappear, and when requesting an extension, you can contact the client directly and extract new knowledge from the communication.

So yes, if someone asks for an extension, then it should be provided, but you need to understand that this is some kind of more serious problem.

I hope this clarifies things a bit.

Only registered users can participate in the survey. Please come in.

Should I extend the trial period to the client?

  • 46% Yes, this will help him understand the value of the product. 58
  • 55.5% Yes, that will make him more loyal 70
  • 18.2% No, if I haven’t tried, then I won’t try it now 23
  • 14.2% No, we don’t need freeloaders 18
  • 1.5% Your answer (write in the comments) 2

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