When it comes to trial-to-paid conversion rates, there are a number of stats floating around out there. Here are just a few:
- 66% of companies report a conversion rate of 25% or less
- 41% of them haven’t even cracked 10%
In addition to those averages, individual companies have reported findings all over the map. To complicate matters even further, conversion rates depend on several factors: product category, target customer, industry, trial configuration, the weather, etc..
So, what are we supposed to make of all that?
Cue the anti-climax: industry benchmarks aren’t all that helpful.
Instead of looking to benchmarks, SaaS companies need to cultivate a healthy dissatisfaction with conversion rates no matter what they might be. If your conversion rate is at 10%, then don’t look for a magic number out there to either excuse or accuse you. Instead, focus on getting to 12%. Then, focus on 15%. You get the picture.
Don’t stop tweaking. Keep searching for opportunities to improve.
Here are 5 questions to ask as you do:
1. How’s the Quality of Leads From Your Community Pipeline?
Trash in, trash out. If the vast majority of your trial users come from poorly qualified, sloppily targeted sources, then you can expect a low percentage of them to convert.
If your strategy is to cast a wide net and bring in as many trial users as possible, then more power to you. But, if you want a finely tuned conversion machine (and a leaner marketing budget), focus on qualifying your trial users more carefully.
2. How Much Friction is in Your Onboarding Process?
Are you asking for too much, too soon? Do you force your community prospects to run a 15-minute gauntlet of questionnaires, platform integrations, and other sigh-inducing obstacles?
If so, then you may be robbing your onboarding sequence of vital momentum. You need to simplify the process. Offer members short steps to success. Ask for one thing at a time and allow them to build speed toward the finish line: conversion.
3. What’s your Time to First Value?
The most critical phase of your onboarding and/or trial period is that (hopefully) short span of time between sign-up and first value.
From the moment they click that green button to the moment you deliver tangible value, the clock is ticking. The longer it takes to give them the goods, the less likely they are to convert.
4. How’s Your Email Marketing Strategy for Trial Users?
It’s incredibly common for users to sign up for a trial, use the product once, and then never touch it again. Be honest: you’ve done it. So have I. Many, many times.
SaaS companies have to overcome that hurdle by successfully activating their trial customers and encouraging them to use the product.
One of the best ways to do that is by way of email marketing during the trial period.
So, if you're not using email to systematically reach out to your trial users and coach them through the process, you're potentially leaving vast swathes of users disengaged.
5. Have you Tried Asking Your Community Members as to Why They Don’t Convert?
It may sound crazy, but simply asking your trial users why they’ve chosen not to pay is a great way to find out what the problem is.
So, at the end of every trial period, ask for feedback from those who decide not to convert. Be specific, follow-up, and continue to look for ways to tweak both your product and the onboarding process for the better.
Trial-to-paid conversion rates are vital for any SaaS company who makes their living off subscriptions. As we saw in the beginning, benchmarks never tell the whole story about conversion rates, so the best course of action is one of discontent.
Now’s not the time to rest on your laurels. Get in there and figure out how you can do better. These 5 questions will help you on your way.