SaaS Reverse Trial: Increase Free to Paid Conversions With This Trial Model
SaaS reverse trial is relatively a new concept, although some famous brands have been implementing it for a while.
For product-driven companies, there are typically two options for acquiring paid users: offer free trials or create a freemium version. Both business models attempt to compel users to upgrade their subscriptions by providing an exceptional onboarding experience and value.
However, both models come with downsides and upsides, so companies often struggle to decide which is the best approach.
Wouldn’t it be nice not to have to choose? How about combining the best of both worlds?
This is where reverse trial comes in—the model that sits perfectly between free trials and the freemium model. Read on to learn what it is and how to implement it for your business.
- A SaaS reverse trial is about granting users access to the full functionalities of your tool for a limited time and downgrading them to a free plan if they don’t upgrade.
- The reverse trial model could work for most SaaS companies, but exceptions exist. Factors to consider before implementing it include the complexity of your product and the cost of offering a free plan.
- Difference between the normal free trial and the reverse model: user accounts get deleted at the end of the normal trial, while the reverse trial maintains user accounts but with limited features.
- The freemium model involves giving users access to a restricted plan that is free forever, with the option of upgrading to the paid plans. The disadvantage here is that the free user might keep freeloading, never experience what they’re missing on the paid plans, and not see a reason to upgrade.
- Companies can sometimes choose to offer a paid trial when granting free trials isn’t feasible.
- SaaS trials can last as long or as short as necessary. A short trial window is good because it creates a sense of urgency, but some complex products need an extended period for users to grasp their essence fully. Use a seven or 14-day window for short trials. Extend to 30-days if you feel your users need more time.
- The industry average for trial conversions is 25% but aim for a higher conversion rate, especially if you’ve been in the market for a while.
- SaaS free trial models: trials with a credit card, trials without a credit card, and live demo free trials for products that require specialized knowledge.
- Wondering how to turn trial users into paying customers?
- Provide personalized experiences.
- Use checklists and interactive walkthroughs to shorten the time to value for users.
- Provoke FOMO by reminding users that their trials are about to expire and telling them what they’ll lose when they don’t upgrade.
- Use funnel analytics to map and analyze the user journey. Maximize insights from this process to continuously improve your product experiences.
What is a SaaS reverse trial?
A SaaS reverse trial mixes the freemium and free trial models to give users a better feel of your product. This approach involves granting users access to your premium features when they sign up and downgrading them to a free plan after the trial period is over.
Reverse trials are great because they allow users to experience the product’s full potential and get addicted to the added value.
Although the concept is new, this business model is not entirely brand-new. Companies like Canva, Toggle, etc., are using it.
In fact, product growth manager Gonçalo Henriques believes the approach is a gold mine for driving product-led growth.
However, the reverse trial is not a one-size-fits-all approach that works for all companies. Here’s how Reforge’s growth manager Elena Verna thinks about it:
“If your product has a high cost of giving out trial or occasional in use (MAU), this option may be a bad fit.”
Free trial vs. freemium pricing models
Free trials grant users access to a product’s full functionality but for a limited time—usually 14 or 30 days. On the other hand, the freemium model gives users indefinite access to a limited version of the product.
The problem with the freemium model is that users don’t get to experience higher-tier features and might not see the value of upgrading. Moreover, users may become too comfortable with the free plan and never consider upgrading.
Both scenarios are a loss for the company unless the users are providing some kind of value in the form of good reviews, word of mouth, etc. But even those aren’t enough, especially when the company is attempting to increase its revenue per user (RPU).
Why should you consider implementing the SaaS reverse trial method?
The SaaS reverse trial helps you strike a balance between the freemium and the free trial models, effectively avoiding the problems that come with them.
With the free trial, users have two options when their trial period is over: delete their data and lose their accounts, or upgrade to a paid plan. While with the reserve trial method, you don’t lose your user base, they are simply downgraded to a freemium and you still have a chance to convert them into paying customers later.
SaaS reverse trial examples
Let’s look at some companies which have chosen the reverse trial method.
Toggl is a time tracking and project management tool built with a lavish freemium model.
Users on the free plan can access unlimited time tracking and add up to 5 accounts. This plan was specifically created for independent professionals, but the company noticed businesses were taking advantage of it by creating multiple accounts with different email addresses.
It resulted in low conversion rates, and the product wasn’t growing as the team envisaged.
One way to overcome the problem was by limiting what freemium users could do. But Toggl chose another approach. The company switched to reverse trial—giving every new user access to the full product for 30 days and downgrading to the free plan after the trial is over. This move turned out to be great and even ended up doubling Toggl’s revenue from its premium plan.
A famous scheduling app Calendly also uses the reverse trial approach.
They do have a free plan for individuals where you can schedule only one type of meeting, but Calendly for teams is the plan that showcases the product’s full functionality. New users are given 14-day free access to this tier with no credit card required.
The accounts are automatically downgraded if users don’t upgrade before the free trial period ends.
The graphic design industry giant Canva generously welcomes all new users to try out Canva Pro for free.
After 30-days, users lose access to premium features if they don’t pay for the monthly subscription.
How long should a SaaS free trial be?
There’s no simple answer to that question. It all boils down to your product’s complexity and how expensive your subscription fee is.
You may want to give a longer time frame if your product takes more time to set up, or you’re running an enterprise SaaS that needs management buy-in.
Otherwise, a 14-day trial is fine. Unnecessarily ending the trial will allow freeloaders to take advantage of it. They’ll keep enjoying your generosity and won’t even think of investing in it.
A shorter trial also creates a sense of urgency that users need at that point in their journey. This urgency will push them to learn about your product, start using it and make a decision quickly.
What is a good SaaS trial conversion rate?
A 15% conversion rate is okay if you’re new in the market and probably haven’t nailed product-market-fit yet. However, the industry average is 25%.
Companies that have been in the game for a long time can aim for around 50-75% conversion rates, especially if they use the opt-out approach for their free trial.
SaaS free trial models
Determining the duration of a free trial is not enough. You must also figure out how to deliver the best experience possible to your users. Throughout this section, we’ll examine each of the three approaches, highlighting the unique features of each.
Free trial model with a credit card (opt-out free trial)
The opt-out free trial is effective for qualifying leads. People will hardly want to input their credit card details if they’re not serious about your product.
The downside of this model is that you’ll get fewer leads. Use it only if you’re after quality leads and don’t care much about numbers.
New companies with insufficient social proof should exercise caution when using the opt-out method as they risk losing potential users.
Even if you’ve been in the market for long, you still want to invest in inbound marketing to educate potential customers and increase their chances of signing up with credit cards.
Free trial model without a credit card (opt-in free trial)
The opt-in free trial method is more frictionless and generally will allow you to have a larger pool of trial users.
The opt-in model is effective when you just rolled out a new product and need a large influx of people to test it.
Live demo free trial
Some SaaS products can’t be self-served. They require some level of training or specialized knowledge before users can make the most of them.
Leaving this step for users to figure out on their own will waste time and can even frustrate them. A better option is to offer a live demo where someone from your team shows users how the product works. You could also conduct sandbox demos, allowing users to test the tool in a controlled environment.
Adding video tutorials, an email course, or a webinar can also help you further explain complex products to new users.
How to turn users into paying customers before the reverse trial ends
It’s one thing to get people to try your product for free; it’s another to convert them into paying customers. The second part is the hardest and usually the part that SaaS companies struggle with.
You can’t convert all your trial users, but applying the strategies below could help you turn a good percentage of them into paid users.
Provide your users with an exceptional onboarding experience during the trial
There is no doubt that onboarding is the most important point of conversion in the user journey. It’s the first intersection the user has with your company and as they say, first impressions are forever.
Personalize the onboarding for each user segment
You have a limited time to show your product’s value and convince trial users that it’s worth their money.
So, even if you want users to enjoy everything your tool is made of, it’s important to begin by personalizing the experience.
Personalization allows users to interact with the features necessary to get their specific jobs done, helping them reach activation faster. A general onboarding isn’t as effective because your users want to achieve different things in your app.
Use welcome screens to collect data upon starting the trial.
Then break users into cohorts and trigger relevant onboarding experiences for each segment.
Shorten time to value with checklists
Checklists drive activation by prompting users to take action and engage with your core features. They also motivate users to complete the onboarding process as people are more motivated to finish something if they can see their progress.
Drive engagement with interactive UI elements
Repeated engagement is important to familiarize users with your tool and get them to love it.
You can drive repeated engagement using interactive walkthroughs. This UI element provides contextual in-app experiences that help users learn your product by doing. It works better than generic product tours that only require the user to sit back and watch.
Provoke FOMO in free trial users by reminding them when the trial is going to expire
Reach out to trial users a few days before their trial ends. Remind them one more time of the value they’ll miss out on if their account is downgraded.
Also, don’t forget to let them know when their account has been downgraded and use your last chance to prompt them.
Map your free trial user journey and continuously optimize it
A user journey map visualizes all steps a particular user takes to reach specific milestones in your product.
Mapping and analyzing the user journey will help you identify the unhappy paths users take and end up churning throughout the trial.
There are several techniques you can use to get this done. One of them is funnel analytics.
Funnel analysis not only identifies the steps needed to reach a certain outcome in your app but also shows how many users progress through each step.
No matter the free trial model you use—opt-in, opt-out, or demo—the most important thing is to ensure users get value from your tool.
The more you can show them that your product is what they need, the more your conversion rate will skyrocket. Go ahead and test the reverse trial approach, then compare the results with your current model and see which works better.
Userpilot makes SaaS reverse trials effective by enabling companies to segment trial users and create UI elements that help users reach activation faster. Book a demo call with our team to get started.