Request to extend the free version of SaaS is a bad sign

Is it worth going to meet the client and extend for him the period of free testing service? Will it make a sale or is it a waste of time for someone who will never buy? His opinion is shared by Lincoln Murphy, a SaaS development specialist, who helped more than 300 cloud-based start-ups to enter the market. The story comes from the first person.

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

“Lincoln, I stumbled upon a recent post where it says that“ short trials + generous extension of their deadlines ”are the starting point of sales. At the same time, you did not talk about it (if I did not miss it). It struck me, because you most likely should have an opinion on this. 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 it from a slightly different point of view. Although it is possible to offer an ideal free testing period from the point of view of most customers, which we wrote earlier in the article “Increasing website sales: how long should a free trial period be for a customer to pay?”

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

However, such a request is an indicator or symptom of a deeper problem that we should 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 is true, I have never spoken openly about such an extension.

I'm not a fan of a free trial renewal, at least automated.

I especially do not like the promotion of renewal ... it is 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 figure out why the client needed it.

Renewal is better than customer loss

Obviously, it is better to offer the customer a renewal or to satisfy his request in this than not to receive money from him and lose forever. Problems arise when you extend the trial period, but did not change anything else. No commitment. 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 it in extreme cases, the client should refuse to use the free version if they do not want to use your service (unlike the opting-in model, where he does not refuse, but simply stops using it ). In case of an active failure, you may ask: can the client simply take more time to evaluate the SaaS?

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

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

Reasons for extending 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:

• Need to consult with other people about whether to use the product, and whether the service is useful for their company.
• It is necessary to give the software to test other people who were previously busy.
• They have not yet completed the evaluation of other similar products and did not have time to make a choice.

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

How to process a request to extend the free version

So, you 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 a renewal.
2. Decide what is a “successful” test for your service.
3. Help them create a plan of action 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 evaluation of your services.

4. There are clear steps:

• you may have to apply common methods to them that allow you to turn the user into a client;
• this must be agreed between you and the potential customer;
• This will ensure that both of you will move towards successful collaboration.

5. After achieving success, ask about the purchase.

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

Now I will move on to why I believe that a renewal request is a symptom of a problem, and not just a client's whim. This must be considered in advance when creating a product and determining the terms of use of the free version.

5 reasons why renewal requests are symptoms rather than a function

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

The trial period alone does not force potential customers to 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 it and you will be surprised).
• Start with quick wins.
• Manage the process along with general activities to increase the conversion of visitors.
• You do not need to do work with the product is too simple, but do not complicate the life of the client ... intricate visitors do not buy.

2. The potential client does not reach success.

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 to mess around with it for a long time. They expect, especially B2B customers, to immediately see the potential of the application and the justification of its cost.

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

• Find out what is the ideal trial period for your customers, and proceed according to this information.
• Organize the process of interaction with the client so that he achieved success.
• Effectively use the social capital of the user.
• 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 in general.

3. Attracting wrong users

These are customers who buy, but not from you, but from your competitors providing similar services, but with different parameters and conditions. However, this does not mean that such clients do not need to be fought.

If different products bring about the same results, then the SaaS of the supplier who organized the work is easier to win. Here are some things you can do for this:

• Understand who these customers are and create a product that will take into account their preferences.
• Find out how they determine the quality of the product and attract them based on this.
• Determine the pricing process and financial preferences of customers:
• Provide the client's financial director with a return on investment together with a comparative table.
• Provide the marketing director with calculations showing how they can achieve certain indicators with your product.
• Yes, and allow customers to share your product with others.
• Come up with the right call to action that would motivate the user, as soon as he achieved success, to take the next step
• Once a potential customer succeeds, remind him of the purchase of your service.
• Some of these things can be done based on the type / size of the company.

4. Attracting wrong potential customers

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

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

5. The trial version is actually too short.

Remember that the duration of the free period is just a marketing trick, which is set artificially and serves to avoid the drawbacks of the “freemium” model.

But do not take this marketing course 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 to renew.

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

• This means that they did not have time to reach the planned point in the allotted time.
• This means that they have not been successful with your application, and this can cost you a client.
• It is likely that those requesting a minority renewal. The rest will simply refuse to work with you.
• A controversial point - “were those who did not request an extension, real potential customers?”
• My experience shows that yes, they were, they just did not succeed working with you.
• Some SaaS owners will justify a low conversion rate in that many users simply did not intend to become their customers.
• If so, great, but see p.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 time available.
• If this happens often, the free period is too short.
• Think about how many people just left instead of asking for an extension.
• Most people simply will not ask you to renew and register, and this is a serious problem.
• This is not because people are “not serious” and “unqualified”, but because you create various barriers and obstacles for them.
• Fortunately, if it depends on you, then everything can be fixed.

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

So yes, if someone is asking for a renewal, then it should be provided, but you need to understand that there is some more serious problem behind this.

I hope this clarifies the situation a bit.