What are your experiences with: Free Trial with payment details vs without?

Question

I'm currently doing some research on whether we should include payment details when users are signing up for a trial, similar to what Netflix or SkillShare have successfully implemented or if we should do our free trials without the need to include payment details.

Benefits with payment details included in free trial signup:

- Higher conversion to paid
- Higher quality customer
- Better customer retention
- Not having to deal with unfinished / idle trials

Cons with payment details included in free trial signup:

- Higher bounce rate
- Potential sour taste / experience
- Slower early growth

I pose the question to you, what are your thoughts and experiences of this?

P.s. would love to be directed to useful resources too.

Nikolas R · Accepted Answer

Like others mentioned, as an end-user, context matters to me, if it's a service I really want I will happily enter my payment info for the trial. For example, I want to watch a show and I don't have Netflix: I will happily enter my payment info for the trial in that case.

However, if it's something that's not too important to me and I'm only signing up for the trial just to try it, then I will be more reluctant to enter payment info.

Something I'd suggest is collecting payment info up front, but only charging the user once they confirm they'd like to continue. This lets you get high quality customers up-front (plus prevent multiple signups from the same user). You can combat the sour taste by making it VERY clear they'll only get charged if they confirm that'd they would like to continue their subscription after the trial ends. This makes it easy for the user to continue once their trial ends (payment info already on file, only one click) and it gives them the peace of mind that they won't forget about the trial and get charged. Google Cloud Platform follows a very similar model.

Sune B. Thorsen · Answer

I don't have experience with this from a business perspective, but as an end-user, I will almost never sign up to a free trial that requires payment details unless it's a well-established brand.

Yes, Netflix and others can get away with it, but I have never been willing to share my payment details with a new website I have only just heard about. I have no problem paying for a product or service I need, but I just don't like potentially forgetting about my free trial and then automatically being charged.

I don't represent everyone, but I do think a lot of people feel similarly.

Sune B. Thorsen · Answer

@sunebthorsen @m_jan_joachim @mukhtarmohamoud I do agree that having to provide payment details does make me question if I really need the product. Oftentimes, I just find the answer to be "no". I think this has to do with the fact that it's incredibly difficult to sell me something off of just having read about it for a few minutes on a website.

If, however, you get me into the "fold" by giving me a no-credit-card-needed free trial, I'm much more likely to pay if I enjoy it. If I gave you my details and didn't enjoy the product, I wouldn't continue paying anyway. So there are potential customers to lose by forcing me to provide credit card details, but not a lot to lose by letting me try the product without payment details.

If you're concerned about people abusing the free trial by creating multiple accounts, you could ask people for their phone number during signup as a middle way. Ultimately though... if people really go through the trouble of creating multiple accounts to abuse the free trial, at least you know you've got a winning product on your hands! And so for everyone creating multiple accounts, there are most likely many others who will pay! :)

Simon Blok · Answer

@sunebthorsen Agree with this. I will not sign up or i have the trust/experience it's worth the payment.

Alternatively i should be convinced by a working demo separate from the sign up process. But the value must then be very clear!

Answer

@sunebthorsen @m_jan_joachim @mukhtarmohamoud I like that last part about 'the trouble of creating multiple accounts' :D that surely sounds reasonable but I am not quite sure if one is able to generalize this behaviour. There are many other factors one has to take into account when deciding if your free trial should be bound to providing details or not. So this might has to be checked on a case by case basis meaning that you should either 'ask' your customers or make something like A/B testing.

Answer

I think what @sunebthorsen says is true. Somehow one does not want to provide payment details for a free trial. On the other hand (from a business perspective) I would argue that insisting on providing payment details ensures that most people will only be able to make use of the free trial period once. So it is harder for customers to scam the business by using the free trial period repeatedly.

JohanDT · Answer

We are soon implementing payment with free trial in our ship: http://bit.ly/3bOc2sV

It's only a 7 day free trial, but our decision was based on the quality and type of our product. It requires dedication and the right intention to use it, therefore a payment solution was needed.

Mukhtar Mohamoud · Answer

@sunebthorsen @m_jan_joachim  -- I agree, from a business point of view, it's a good practice and puts you in a strong position but from a customer perspective, it might also be good because then it makes them question whether this is ACTUALLY something they need / value. I take trials more seriously when I give my payment details, I also value the product a lot more :D

Mukhtar Mohamoud · Answer

Thank you for your input Sune, this is definitely something I need to think about, business wise AND technicality wise.

Sune B. Thorsen · Answer

@sunebthorsen @m_jan_joachim @mukhtarmohamoud I do 110% agree that this should always be considered on a case-by-case basis. Absolutely - good point.

Mukhtar Mohamoud · Answer

@johan_duus_terkelsen That's very interesting! Good luck on the launch!

What are your experiences with: Free Trial with payment details vs without?

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