Free trial vs free forever
by Andrew KampheyFrom the time I launched Better Sheets in 2020, I didn't have a free plan. It was pay all the way. For 2 years I posted free videos on YouTube, and put up free products from time to time.
Not until April 2022 did I offer a free plan. And I essentially said it would be a "free membership" They get limited access, but it'll be free.
no end date.
no urgency to upgrade for more.
5 months later and I'm thinking of changing it from a Free Forever type of plan to a Free Trial.
My initial thinking was to gather email addresses and it would be easier to check out what's inside by getting a limited free membership. But now I feel like people are stuck on free, forever.
And while free members are pretty small cost, it still is a cost and is going to get more expensive every years. Convertkit will charge roughly 15 cents per year per subscriber, plus additional rows of data have caused me to upgrade to a paid database plan on Heroku. while these costs are small, they are only small with a few thousand free members. If I want to scale 10x, or 100x then the costs will go up with it.
But will Free Trial actually fix this problem?
I'm truly wondering this.
Part of me says the costs will still be there, because if someone signs up for a free trial, then they are being added to my convertkit crm the same.
But the added benefit is the urgency and ideally the Intent.
Sure there is a pressure to upsell (from me) and upgrade (the member). The urgency increases.
But the intent I think is much more important.
If someone signs up for a free membership the intent is to sign up for a free membership.
But if someone signs up for a membership that has a free trial, they intend to upgrade.
Here's another benefit from a free trial:
Instead of asking to change membership from free to paid. The member is already granted access and will lose it if they don't pay.
That can be highly persuasive.
And I'm not giving up free content. I still have a completely free YouTube channel. A free newsletter. Free products via gumroad.
Wondering if there are any pros and cons I haven't thought of yet.
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Your thinking seems good to me. Dealing with people who have no intention of paying you is unsustainable.
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I’d say it depends on your product.
Free users over time will naturally convert into paying users if their needs grow together with their business. -
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Definitely agree with this one. Some people just want free. They never had any intention for paying.
I think free tiers should be limited, not in feature access, but in.. other ways, like number of documents you can save/store.
The incentive of that is: shit or get off the pot. You saw everything this has to offer. Either it's what you need, or it's not.
When I find something that does exactly what I want, and there's multiple tiers that let me gain more access at a small price while I continue to learn, I can quickly justify full price.
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If you try to deal with people who don't intend to pay you, you will suffer a great deal of stress and frustration.
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Personally, I've always considered that problem with "free forever" plans. I think the idea of a free trial long enough for someone to implement the service into their business and then cutting off features until they pay is the way to go.
Don't require credit cards up front because it just causes friction in the sale. Make it easy to get started and when they ought to be using it more, cut off functionality to create the urgency you're looking for. If they like it enough to have used it, the sudden inaccessibility may be enough to pull out their card.
I love that concept and I think it's the way to go to reduce friction leading up to the final sale.
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At Outseta we started with freemium, went direct-to-paid, then landed on a 7-day free trial with credit card required. This has been the perfect middle ground.
Definitely creates urgency that freemium does not, and you can always clean up ConvertKit periodically by removing trialers that didn't convert if you don't intend to market to them again.
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Interesting. I am surprised you found that entering a credit card is the optimal solution. I would definitely want at least a one hour free trial before entering my credit card.
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Entering a credit card will absolutely deter some (many) people, but those who choose to enter it seem to be the potential customers that are most legitimately interested in whatever it is you are offering. You're also sort of setting the expectation with the potential customer that they are on the fast track to becoming a paid subscriber. If the goal is to spend your time with people who have a real intention of paying, this surfaces people that have that intention most strongly.
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I agree.
I don't see why so many founders just don't have the confidence to ask for credit card upfront.
Once you don't ask for a credit card, we're again leaving it to chance again; it's as if they never converted.
They're default-churn instead of default-upgrade.
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Depends who you target. If you target anything larger than a small organisation, then a CC-first trial is v off-putting due to the red tape and sign-off to get their hands on a company credit card.
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Great point.
Good thing 90% of indie hackers don't sell to enterprises.
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I wonder whether that's intentional, or because of short-sighted product and marketing decisions (such as requiring a CC) are made? It's much quicker to grow if you sell larger ticket items, which are much easier to sell to medium businesses and up.
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Yes, it's quicker to grow, etc.
Perhaps most indie hackers are just intimidated?
The competition is probably way more cut-throat upstream.
Also, beyond a certain price range, it's no longer self-serve + inbound marketing, probably more outbound marketing + sales outreach, and most indie hackers don't really have the kind of resources for that.
My last SaaS was in the dental market, and the average competitor product sold for $199/mo. Score! Or so I thought.
I literally went door-to-door in my city selling a $99/mo product to dentists. It was pure hell. I couldn't make it work. The next product I did, which is my current product, I started at $10/mo and started getting sales right away.
I guess it made a difference that my target customers weren't "online", so I had to sell them in-person or at least through Zoom demos, but I vow never to do another similar product ever again.
That's my story, most indie hackers probably have other reasons why they don't do products that start at $100/mo and up.
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Have you thought about a reverse trial? I found it quite interesting as the user gets the value and creates a FOMO status.
Here an interesting article
https://amplitude.com/blog/reverse-trialLet me know what do you think
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Good article. Perhaps for a solo founder the reverse trial is too complicated for me to implement. Also reading that I realized, it did a good job of differentiating the time periods between startups and enterprise. I'm not in the enterprise space. My user is the person using and paying for the access to video and tools and templates. So I don't need a longer time horizon for the trial.
what I'd like to do is a gamified free trial. This might be too clever but I'd very much like to try. Everybody can get a 7 day free trial. in those seven days they have access and for watching a certain number of videos, or completing a short course, their trial is extended. Maximum to 28 days. My theory is that I don't want to cut people off from getting addicted to videos. And I'd rather, just in the grandest scheme of things, educate people than try to make more money. All our lives would be better if more people knew how to make better spreadsheets. Just a personal theory of mine. The world would have less shit in it :)
That theory is what led me to the free forever, but I also don't really want to spend infinite amount of money on people who don't even watch, and just sign up. I think a gamified free trial solves that.
sign up for free, if you watch lots of videos get more time to decide if you want infinite access. or monthly access.
And if I start to implement this, I might find that in fact it's way more complicated than I imagined :)
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Hey Andrew, I'll say this:
The free users don't just cost you in terms of server expenses, but more importantly they're lost sales, revenue, or MRR. That's the true cost of free users.
People won't pay unless they're made to, and making them pay forces them to show their cards -- is this valuable enough for me to vote with my wallet?
Like you said, "intent."
This is why I've even moved away from "no credit card required" free trials, as they'll disproportionately attract tire kickers.
The offer is there, the reviews/testimonials are there, you even get to poke around for free, plus a generous refund clause.
Are you interested to buy? It's a yes/no.
If yes, I'll offer you free 15-30 days access on me, as a show of goodwill.
In turn, you have to meet me halfway -- put your credit card details down so I can charge it at the end of your free period.
In the meantime, you can cancel anytime, should you think it's not a good fit.
People say listen to your users, yes, but users will say anything and everything that benefits them at your expense:
"Make it free forever, you'll attract more people!"
"Don't require credit card in your free trials, you'll attract more people!"
God knows I've dealt with my fair share of users who talk like this.
I've never been able to make a positive ROI on doing stuff for free... Maybe others have, but I haven't. In fact, recently my revenue has been going up and up simply by asking for more money (doing the opposite of "free"). You'll have to decide if "free" or even no-credit card free trial is something you can make work in your favor.
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I agree with what you're saying. Seems I'll let the massive platforms handle free users from now on. Let YouTube gain free subscribers, let the Facebook Group handle the free hunters. Let Gumroad get free, Let Substack handle free user. but not spend any money on recurring costs for free users.
Or at least maybe segment them highly out of the way on convertkit much more. And delete them after some amount of days.
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Definitely better to have just free trials if subscriptions is your only income channel. Even with free trials some users will do all kind of tricks to avoid paying (like creating new email accounts in gmail just for the purpose of getting a new trial), but these are just a small minority.
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Was considering adding affiliate links to some emails... but perhaps the complexity is too much at this stage for a solo founder like me.
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If the service provides enough value, the trial users should convert, if not, then you need to figure out what is missing in order to make the product worth it. The good thing is that you will have loads of users that you can contact and ask why they did not subscribe :)
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I just upgraded my ProtonMail account, the reason for upgrading was simply because I reached a limit in my current, already paid, plan (more specifically I wanted to add another custom domain). I think the best way to make users move from free to paid or upgrade to a higher plan is to simply reduce the amount of stuff you give for free. Give just enough that they can test it and let them use it.
I am not sure how it would work in your case, but for courses usually you get free a subset of the content (usually first sections of each chapter, enough to be useful but still intriguing so you want to find out more).
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While I'm still at the beginning of my Indiehackers journey, I agree that free trials are the way to go in most cases. A free tier can be beneficial if you can use those customers as advertisements (social proof, branding). For example by attaching your brand name to shareable products (sent with XYZ). A problem with the free tier could be, providing a distorted/incomplete image of the product. Thus I prefer the free trial, where a user can determine if the (complete) value is worth paying for.
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Free forever plan makes sense when your free customer contributes to your growth. When an additional free member contributes to the viruality of your product. Think hotmail's original signature line, or LinkTree's watermark.
On the other hand, another benefit of having a free trial only is to reduce the amount of support to your free users. If you are a part time founder or lacks time or staff to support your users, then free trial reduced that support over time.
At TaskRobin.io, I have chosen free trial. So I can provide good support and service to people who, like you said, are intended to pay.
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A free trial is an excellent sales strategy that can lower your cost of new-customer acquisition
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Great post!
I'm 100% with you... I mean, clients should pay. But eventually, if the friction is too high, I'll go for a reverse trial.
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TL:DR; I think free trial is the way to go!
We've just been through this where freemium sticks you in between the two worst options, either:
a) You give too little away, and users don't get the full product experience
b) You give too much away, and the free plan becomes too attractive and it's hard to convert them into paying customersAfter two years messing around with freemium we're currently switching to a free-plan, and it's something I wish we'd done a lot sooner.
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Free trials are usually a better solution, but the reason to choose freemium is that your free users can become a powerful acquisition channel.
I remember signing up for Spotify many years ago and telling my friends how amazing it was. It was definitely worth it for them to give me that free account because I referred additional users. The question for you is: are your freemium users signing up new accounts?
I would recommend adding a "How did you hear about us?" field to your signup form to figure this out. If a significant number of people are being referred by others, then freemium might be working well for you, despite the lower conversions. If not, then it's probably not worth it. You'll likely see more conversions by charging people after 14 days and it won't hamper new acquisitions.
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I think free forever will be good if a person needs more and more count of things after some time. It's like found of available requests to CMS. It is free, but in the future people will need more.
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Free trial vs free forever depends on your clients' behaviors and buying cycles.
A trial is good to manage potential anxieties.
Free forever means that you can sustain yourself by offering to everyone a free version and monetizing just the biggest clients.
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Thanks for the input. I think I'll always have free content, but on YouTube, and I'll keep making free tools (gumroad). Basically keep making free stuff forever, but not have to pay to host it, myself.
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Hi Andrew,
This is a big question for us too.
We are tryin new model at Magnetiq.
We offer our premium plan for just $1 for the first month (normally $99).
So, users can try Magnetiq during 30 days. -
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