Is A Free Trial The Right Strategy For Your Company?

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There are number of organisations who entice new customers with the promise of a free trial. For some companies this can work really well as a marketing option. For others, the strategy is not very effective and can cost the organisation money.

To decide whether a free trial is right for your business you need to be aware of the advantages and disadvantages of the free trial model.

The Advantages

A free trial has some good benefits, not just for the user, but also for the business.

While the user benefits from having access to the full product for a period of time, the business benefits by being able to demonstrate how useful its product can be. This means that while the user is making use of your product, they are also becoming more dependent on your product.

Therefore when their free trial ends, the user is more likely to notice the absence in their day-to-day lives than if they never had access to the product in the first place.

Another benefit for your business is that by offering a free trial you are ensuring that users are investing time and energy in getting to grips with it. People don’t like to see wasted time or effort so they are more likely to purchase the full product when the trial ends.

The Disadvantages

A free trial requires you to make a bigger initial investment to keep track of those who have signed up for it. Otherwise you could lose potential paying customers if you aren’t following up on those leads.

Also you can face the prospect that your free trial will turn away some customers. This is because a free trial generally requires significant amount of information to be provided by the user to access the product. This information, whether it includes details of a credit or debit card or not, is considered a block. If the user doesn’t like the block they won’t sign up. On the other hand, any user which does enter in the information is significantly more likely to purchase the whole product after the trial.

Is Your Product Feasible?

One thing you should also consider is whether or not your product is feasible on the free trial business model. If your product can be used on a regular basis then it is likely a good fit. However, if you business has a seasonal or irregular use, customers could use the free trial to get the use out of the product they need during a certain period and then leave without paying anything.

So ensure there is a long term and regular use for your product before considering a free trial.

Even if a free trial is not right for your product there are other options. One other option is the freemium. These have several good benefits for a business which include:

  • A high visitor to sign up rate.
  • The likelihood of a larger audience.
  • Allows risk free testing of product features.
  • Allows you to test referral programs.
  • The ability to test upgrade hooks (entices the user to upgrade their membership).
  • You’re a more attractive acquisition target (the number of users can be a huge influence on whether big companies will want to buy your company and on the value they determine your company is worth).

These benefits can outweigh the best of the free trial and so might be something for you to consider. But again it is a question of looking at what you have to offer and how the consumer can use your product. Then you can decide which model is best for you.

Once you have made that decision you can really push forward and bring in a number of users to try out your products and gain more paying customers, increasing your revenue and sales.

Do you need recurring billing and subscription management software? Call or email one of our experts at info@fusebill.com or 888.519.1425. Or, check out the Fusebill free trial.

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Tags: Subscription Billing

Fusebill Inc.

Fusebill simplifies subscription and billing management by automating many manual accounting and financial processes and workflows. Our cloud-based platform gives companies the freedom to grow their businesses, the flexibility to capitalize on new product opportunities, and the agility to maintain a competitive edge.

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